EXCUSED:

During the 2003 legislative session, the committee conducted an in-depth
study of the budget of the Department of Health and Welfare. He has
asked the Department to present a one-day overview of the budget they
prepared for the Governor’s office for SFY2005.

Committee members should contact the chairman if they have a specific
item of interest to be considered for an in-dept study during this session.

During the interim this year, several items of interest were considered and
Chairman Brandt has been working with individual members and task
force members. He listed several areas the committee has been involved
with, such as, Senator Stegner has diligently worked for several years
with mental health issues and, hopefully, has a consensus piece of
legislation for this year. Suicide prevention is another issue and is also
part of that. The Child Support Program is an issue that all members have
had an opportunity to deal within one way or another.

This past year, a prescription drug task force has tried to get an enhanced
authorization program organized. There is also a new Medicaid bill of
legislation. How in-depth does the committee want to be involved with this
issue?

The budget aspect, the committee will cover as much as members or
JFAC (Joint Finance Appropriations Committee) members request or
need.

EXCUSED:

16-0203-0401

First, they provide the requirements for instructors, education,
certification, and agency licensure for a new level of EMS provider called
the EMT-Intermediate which was created with legislation passed in a prior
session of the Idaho Legislature. The EMT-Intermediate will allow more
advanced skills and medications to be provided to patients, and is
expected to primarily benefit rural areas that are unable to train or support
paramedics.

The second issue addressed in this docket is the repeal of one of twelve
(12) requirements for EMS agency licensure in Idaho. The section listing
these requirements are on page 9. Subsection 10 on page 11 “local
governmental authorization” was accomplished through the EMS agency
documentation of compliance with local EMS ordinances and ambulance
district rulings as part of their application.

While the EMT-Intermediate rule drafting was in progress last fall, a
controversial application was received by the EEMS Bureau. We were
confronted with conflicting endorsements of an application from an EMS
agency based in a city in Idaho, while the county opposed the application.

The rule provided no guidance for this type of scenario or any other where
city and county opinions or ordinances are in conflict. This rule was
determined to be an inappropriate delegation of our authority and is
beyond the scope of assessing the personnel, equipment, and other
agency-specific functions to determine fitness for licensure.

16-0210-0401

The Division of Health is updating the Rules on Idaho Reportable
Diseases to include SARS and West Nile virus infection on the list of
Reportable Diseases and Conditions. We also added the control
measures that will be taken if either of these diseases is reported. We
added SARS to the list of daycare and school reportable and restrictable
diseases.

These additions to the rules will enhance control and prevention of these
diseases in Idaho.

16-0214-0301

Because they are interconnected, she discussed both dockets at this
time. She provided a fact sheet describing these dockets. (See attachment #1)

These rules do not propose new language. They simply consolidate all
rules affecting swimming pools into one chapter, and repeal a chapter that
no longer contains any significant language once the swimming pool
language is moved.

Docket 16-0214-0301 – This docket consolidates existing language about
the construction and operation of swimming pools into one chapter as a
result of the repeal of chapter 16.05.05 (docket 16-0505-0301). The
movement of language includes: provision of legal authority to establish
fees for services; permit and plan review fee amounts; and provision for
the waiver of fees. This docket will also allow for the elimination of the
reference to chapter 16.05.05. No new language is being proposed.

Docket 16-0505-0301 – The purpose of this docket is to repeal the entire
chapter. After the split of IDEQ (Idaho Department of Environmental
Quality) from the Idaho Department of Health and Welfare in 2000, and
the movement of sections of IDAPA 16 into IDEQ’s code, chapter
16.05.05 was left with three substantive sections: 130 swimming pool
permits, 202 clean indoor air act regulation waivers, and 900 waivers of
fees. Section 202 is redundant with language contained in the rules
governing indoor smoking. Only the swimming pool permit and waiver of
fees language remains. Proposed changes in docket 16-0214-0301 will
move language from this chapter, leaving no substantial language in
IDAPA 16.05.05. Therefore, the chapter can be repealed.

16-0219-0301

We have significantly changed the appearance of the rules from previous
iterations in that we have adopted the federal Food Code by reference in
these rules and specified only the modifications we are making to that
federal code. This approach has significantly reduced the volume of the
rule and thus the associated cost of rule making.

There were three areas of concern that were expressed and all have been
addressed:

• Concern that a person “in charge needed to be present during all
  hours of operation.” That was resolved by adding Section 201 that
  states that a person in charge or their designee needs to be
  present during “hours of food preparation and service.”

• A request from a chain grocery store that the rules allow self
  service to bulk frozen fish. No consensus was reached and in the
  absence of federal or other guidance on the matter, a conservative
  approach was taken and the rules continue to restrict that type of
  self service access.





• Finally, in the process we failed to involve one group of the
  regulated community. That group was the correctional
  facilities/jails. We learned Monday that the rules would cause
  considerable disruption to the variety of food preparation and
  service methods used in those facilities. We believe the most
  appropriate resolution to the concern is a statute that exempts
  those facilities from compliance with the Food Rules. That statute
  is being drafted and will be supported by both the Department of
  Health and Welfare and the District Health Departments.

MOTION

16-0301-0201

The fiscal impact of the rule changes are $2,000 for automation (includes
development of an ad hoc cost report and programming for rule change).
Operational Costs: an annual program cost savings of $78,000 in State
General Funds is projected.

Negotiated rule making was not conducted since all rule changes were
made in order to assure consistent program operation following the
State’s legislative increase in the maximum TAFI grant payment.

16-0301-0301

MOTION:

A motion was made by Senator Darrington to approve Docket No. 16-0301-0301. The motion was seconded by Senator Sweet, and motion
was carried by voice vote.

16-0301-0302

The Department of Health and Welfare requested the committee to reject
Sections 346, 347, 348, and 349 of IDAPA 16-0302-0301. It was
determined these sections will not do what the Department first
anticipated.

16-0303-0301

The rule sets forth administrative procedures for the Department to
access employment and health insurance information through the use of
the National Medical Support Notice, in order to secure health insurance
for children as a part of a child support order. It also sets forth either
parent’s ability to request an administrative review.

16-0304-0202

These rule promulgation removes the requirement that legal and qualified
immigrants receiving disability benefits be legally present in the United
States as of August 22, 1996, for food stamp eligibility; adds references to
the disability criteria; deletes references to SSI being a means-tested
program; updates total number of weekly hours for part-time employment,
references to standard income deductions gross monthly income eligibility
standards net monthly income eligibility standards and maximum food
stamp benefit.

16-0304-0301

16-0305-0203

16-0305-0301

16-0305-0302

16-0308-0301

The rule amendments were made to clarify citizenship requirements and
extend eligibility to TAFI for citizens and qualified non-citizens in
compliance with federal regulations. The rules were also amended to
clarify individuals not meeting the citizenship or qualified non-citizens
when all other conditions are met, may be eligible for medical services.

16-0308-0302

Section 133 is being amended to clarify the Social Security Number
(SSN) requirements to align with the federal requirements that the SSN
must be verified before an applicant is eligible for RAFI benefits.

16-0320-0301

16-0414-0301

To avoid having to change this rule on an annual basis and to reduce
procedural steps in the administrative rules performed by state
employees, the benefit determination procedures and the percentages will
be place in the Intake Manual used for LIHEAP. A summary for
determining the annual benefit will replace the procedures, also, language
has been clarified and some renumbering of the section.

16-0612-0301

During the 3.5 percent hold back imposed by the Office of the Governor, it
is necessary to increase the percentage of the amount families are
required to pay for their child care each month. In order to achieve
$265,400 in savings by June 30, 2003, it is necessary to increase co-payment by six percent (6%) per child, per month. This will be
accomplished in rule change by increasing the sliding fee schedule found
in IDAPA, Section 06.12.307 by 6 percent (6%).

Senator Kennedy voted Nay Senator Bailey voted Aye

Senator Burkett voted Nay Senator Sweet voted Aye

Senator Ingram voted Nay Senator Darrington voted Aye

Senator Stegner – absent excused Senator Compton voted Aye

Senator Brandt voted Aye

The substitute motion was carried by a vote of 5 Ayes, 3 Nays, 1 absent.

nine (9) rule making dockets for the Division of Medicaid, as follows:

16-0309-0212

The purpose of this docket is to update the terminology used to describe
the department’s Traumatic Brain Injury Waiver program in order to
improve understanding and clearly describe services. Medicaid staff
worked with internal staff and external stakeholders to update these rules
for this program that has been in effect since October 2002.

Two positive comments were received on this docket. Legislative Services
found no issues with this docket.

The department requests you approve this docket as final.

16-0309-0215

Both Health & Welfare Germane Committees had some concerns about
how the temporary rules affected access to case management services,
particularly for those individuals with mental illnesses. The Germane
Committees directed the department to amend the temporary rules.

The department met with legislators and provider representatives in order
to address crisis coverage. As a result of these meetings, this docket was
amended to:

• Allow up to four (4) hours per month of crisis case management
  without department authorization,
• Retain the four hours of ongoing crisis management, and
• Include another four (4) of crisis if more restrictive criteria have
  been met.

A key outcome of this work was the development of criteria that reflects a
“crisis” and clarification of crisis case management services.

Crisis case management means “linking, coordinating, and advocacy” ­ it
does not entail the provision of direct services such as crisis counseling,
transportation, or skills building which are provided through other
channels. Also, these rules require providers to document crisis services
and submit written justification when crisis hours fall into the more
restrictive category.

This amended docket also lengthens the interval for service plan reviews
from 120 days to 180 days. The amended docket also allows licensed
clinical professional counselors without private practice licensures and
marriage and family therapists to provide case management services.

Rather than keep the temporary rule in place while the pending rule
awaits legislative approval, the Department amended the temporary rules
with the same revisions which have been made to the pending rule.

This concludes my overview of the amendments made to this pending
rule docket 16-0309-0215. The department requests your approval that
this docket be approved as final by this Committee.

An e-mail to the committee was submitted, for the record, from Steve
Hansen of Idaho Falls, Idaho, dated January 14, 2004. His e-mail
reported “Since these temporary rules are at least slightly better than the
previous rules, I will not testify in opposition to them.”

16-0309-0217

This rule docket updates terminology regarding the department’s peer
review organization and provides for the consistent application of
penalties for late submission of a review docket. The clarification was
made to ensure that all procedures are submitted in a timely manner for
medical necessity review to protect the public health and safety.

This concludes my presentation on Docket 16-0309-0217. The
department requests your approval that this docket be approved as final
by this Committee.

16-0309-0218

This rule docket removes the Medicaid payment for the entry of laboratory
results into the Clozapine National Registry for participants who require
Clozapine to treat mental illness.

In October 2001, the department reduced its payment for this service from
$29.07 to $5.00 to bring our payment into line with what other states were
paying. After additional research we found that Utah, Wyoming, Montana,
and Nevada were not paying for this service at all under their Medicaid
programs. Last year, Idaho Medicaid followed suit and elected not to
continue the $5.00 administrative processing payment. This is consistent
with other reimbursement policies which do not establish an additional
reimbursement rate for administrative activities.

The department requests your approval that this docket be approved as
final by this Committee.

16-0309-0301

This rule docket describes the payment methodology used to reimburse
out-of-state nursing homes for care provided to Medicaid eligible persons.

Medicaid payment for out of state nursing home care is very limited and
generally is only allowed if the care the person’s needs are not available
in an Idaho facility. Because of the complexity of our current acuity-based
reimbursement for instate nursing homes, the department has elected to
pay out of state facilities the same rate as they receive from the Medicaid
program in their home state. This simplifies their billing and claim
submission process.

This concludes my presentation on Docket 16-0309-0301. The
department requests your approval that this docket be approved as final
by this Committee.

16-0309-0304

This rule docket restores routine and preventive coverage for adults
effective July 1, 2003. Medicaid was able to restore these benefits as a
result of a special appropriation at the conclusion of last year’s legislative
session.

This docket also includes technical changes that reflect new HIPAA
(Health Insurance Portability and Accountability Act) coding requirements.

The department requests your approval that this docket be approved as
final by this Committee.

16-0309-0306

This rule change reflects benefits added for mental health case
management as a result of a special Medicaid budget appropriation for
State Fiscal year 2004. You may recall that mental health case
management benefits had been reduced as part of the 2003 Budget
Holdback. The holdback designated a service cap of four hours of
targeted case management per month. With this year’s appropriation,
Medicaid has been able to restore some of the ongoing case
management services that had been reduced.

The department was allocated approximately $148,000 to provide
additional mental health case management services. The department
increased the number of ongoing case management hours ­ those that do
not require meeting”crisis” criteria ­ from four hours per month to five
hours.

The resulting benefit package currently allows for:

• Five hours of ongoing case management,
• Three hours of crisis case management that doesn’t require prior
  authorization; and
• Four hours of crisis case management that requires justification
  and prior approval.

This concludes my presentation on Docket 16-0309-0306. The
department requests your approval that this docket be approved as final
by this Committee.

16-0309-0310

The purpose of these rule changes is to reduce the administrative barriers
that have created reluctance among school districts to become Medicaid
providers. Over the past year, department staff has been working in
collaboration with the department of education and school representatives
to streamline procedures that will improve access to care for Medicaid
eligible children. By encouraging increased school participation in
Medicaid, more children may be served in a familiar environment with
services coordinated and managed under a single roof.

We have already seen the positive affect of this rule change. In January
2003, there were just 44 school districts enrolled as Medicaid providers.
By June 2003, this number increased to 71 districts. The number of
eligible children receiving services also jumped during this time frame, up
from 3,300 to 6,400.

School district providers are unique in that they fund the Medicaid state
match ­ there are no costs to the state Medicaid program when services
are billed by a school-based provider. This is an attractive service
arrangement that the department wants to further develop and support.
The department has begun working with some private providers and
school district representatives to develop protocols and templates for
coordinating services. Private providers can play a key role by providing
an additional resource during the school hours. Children can be better
served by having most of their needed services provided during the day
rather than after a long school day. Schools are encouraged to contract
with providers and bill Medicaid for all services whether provided directly
or through a contract. Many school districts have already established this
arrangement in their communities.

The department will continue to work with schools and private providers to
support this cost-effective collaborative effort to providing services to
school aged children.

The department requests your approval that this docket be approved as
final by this Committee.

Jana Jones, from the State Department of Education (SED), presented
public appreciation to the Department of Health and Welfare for the
excellent work and dedication the department provides to the SED.

16-0309-0311

From a procedural stand point, you are reviewing this docket in the middle
of its development. These rules were published as temporary rules in the
November Administrative Bulletin. Three public hearings were conducted,
and public comments were accepted through November 26, 2003.

As a result of the hearings and comment, the Department has developed
amendments to these temporary rules which are to be published in the
March Bulletin. You have been provided with a copy of the amendments
to this rule docket. The department has informed stakeholders that the
amendments are intended to be retroactive to December 1, 2003 ­ the
effective date of these rules.

The Department is asking this committee to extend these temporary rules
on the condition that the Department precede with the amendments that
have been provided to you. It should also be noted that once these
amendments are published, there will be additional time for comment and
hearing.

In addition, these rules will come before you in the 2005 session for final
approval.

The main reasons for these rule changes are to clarify service
provider roles in light of staffing reductions in the Department’s
Regional Mental Health Authority and to address health & safety
issues.

The rule changes affect two distinct mental health benefits: 1) Psycho-Social Rehabilitation (PSR) and 2) Mental Health Clinic services.

The first part of the docket changes the PSR rules to reflect the reduction
in Department Regional Mental Health staffing. As a result of the
reductions, private PSR providers will now perform the assessment and
service planning functions previously done by state staff.

Additionally, these rules incorporate service definitions, clarify provider
qualifications, and spell out service expectations. Significant clarifications
include the requirements that:

• PSR Agencies personnel coming into direct contact with
  participants must comply with existing statutes governing criminal
  history check requirements; and,





• PSR agencies must provide 24-hour crisis response services for
  their participants or make contractual arrangements for the
  provision of those services.

The changes to the mental health clinic rules and related partial care
rules were made primarily due to safety issues. Over the past year,
the department was alerted to situations where individuals appeared to be
at risk when receiving care under this benefit.

Prior to these rules, “partial care” — a Mental Health Clinic Service — could
be applied to a number of programs. Some of these programs consisted
of supplying clients with cigarettes, coffee, and television for up to eight
(8) hours per day. And because service expectations were not clearly
articulated, many of the safety issues found over the past years have
arisen in this service setting.

The rules before you tighten up the definition of partial care services to a
structured program of therapeutic interventions. The intention of these
rules is to remove any confusion about what services should be provided
and to clearly define the expected service outcomes.

This rule docket does not introduce any new federal or state requirements
for mental health clinics except for the inclusion of building standards,
which were added as a direct result of documented cases of child
endangerment due to substandard buildings that were being used as
clinics. These temporary rules contain federal and state guidelines that
have been in effect for many years. All changes are intended to result in a
greater understanding in the provider community of the scope of mental
health services as they are required to be.

Based on three public hearings scheduled in Boise, Pocatello and Coeur
d’Alene during November, amendments were prepared that further clarify
service expectations. The comments received came from the
department’s Family & Community Services Division, the department’s
Fraud & SURS (Surveillance and Utilization Review Section), private
providers, and individuals and families receiving services under this rule
docket.

An area of significant confusion has been the requirement for physician
oversight ­ both in terms of expectations for clinic supervision and for
individuals’ care. The additional amendments the Department is
proposing clarify the requirements as follows:

• Clinics must be under the direction of a physician and must spend
  as much time in the facility as is necessary to assure that
  participants are getting services in a safe and efficient manner in
  accordance with accepted standards of practice, (have used one
  hour per month).





• Each participant’s care must be under the supervision of a
  physician directly affiliated with the clinic. The clinic may have as
  many affiliations as necessary to meet the needs of the
  participants served. The physician (can be the existing health care
  physician) who supervises the participant’s care does not have to
  deliver this service on-site.

This concludes my presentation on Docket 16-0309-0311. The
department requests this Committee to extend these temporary rules with
the condition that the Department proceed with the proposed
amendments.

These rules are necessary to accurately describe changes in provider
roles and to ensure the safety of individuals receiving services under this
benefit.

Representative Janice McGreachin had provided committee members
with a letter regarding docket 16-0309-0311. She invited the committee to
attend the House Health and Welfare Committee meeting on Thursday
(01/22/04) in the afternoon as the House discusses docket 16-0309-0311.
(See attachment #1)

The Mental Health Providers Association of Idaho President April
Crandall, testified in opposition to Section 469 of docket 16-0309-0311.

Kelly Keele from the Mental Health Providers Association, testified in
opposition to docket 16-0309-0311, and provided three handouts outlining
his objections. (See attachment #2, #3 and #4)

Laura Seuri from the Mental Health Providers Association, testified in
opposition to docket 16-0309-0311.

After a lengthy discussion and review of IDAPA 16-0309-0311, Chairman
Compton determined to hold this rule and reschedule for an additional
hearing later next week. The Chairman expressed the appreciation of the
committee to the people who attended the meeting and those who
presented testimonies.

IDAPA

16-0309-0213

This is a pending rule that the Division is asking this committee to
approve. This same rule was presented last year as a temporary rule and
the committee voted to extend it.

In 2001, the Legislature amended Idaho law to remove a requirement that
the state pay for abortions to save the health of the mother,
Implementation was delayed until July 1, 2002, because of a court suit
challenging the legality of the amended statute.

The court upheld the amendment. At the same time, the court ruled that
the state law requirement to have two physicians certify the necessity of
an abortion violated federal law and could not be enforced by the state.
The court’s decision was effective July 1, 2002.

The temporary rule before you implements both the statutory amendment
and court decision by:

• Removing state payment for abortions to save the health of the
  mother.





• Changing the two physician certification requirements to
  certification to one physician.

No comments were received opposing the rules, and no hearing was
requested.

The department requests you vote to approve this rule.

EXCUSED:

Dr. Olsen of Mesa, Arizona, was elected to a six-year term on the AARP
Board of Directors at the 2000 Biennial Convention. During the 2000-2002
biennium he served on the Board Governance Committee and the AARP
Insurance Trust of the Health Care Options Program. He also continues to
serve as chair of the Convention Program Committee.

Dr. Olsen retired in 1992 as President and CEO of Delta Dental Plan of
California. Prior to that he was an executive director and managing editor
of the Academy of General Dentistry and served in the United States
Army.

Dr. Olsen has received numerous awards and recognitions including
induction in the Delta Dental Association Hall of Fame, receipt of the first
Hillenbrand Fellowship in Dental Administration and Volunteer of the
Week from the Mesa Arizona Independent Newspapers.

Dr. Olsen stated, I’m pleased to have the opportunity to talk and brief you
today about the new prescription drug benefit in Medicare. The historic
passage of the Medicare prescription drug bill has created opportunities
and challenges for MRP, its members and volunteers, but we also believe
this has opened a new era of opportunity for Medicare beneficiaries
throughout the country.

The law is 681 pages long-about the size of a big-city phone book–and
that’s what I’ll be trying to summarize in the next few minutes. I’ll do my
best.

The benefit portion of the bill is worth about $400 billion over the 10-year
period from 2006 to 2016. Four hundred billion is a very good down
payment, it’s a good start, and what we like about the legislation is that it
puts this benefit into the structure of Medicare. Four hundred billion
dollars, however, does not cover all of the need, and we’ll be working in
the years ahead to try to expand that commitment.

Given that, Congress had to make some choices about where the $400
billion was best spent, and they emphasized two areas, maybe three
areas. The first was that they wanted to be sure that those with the
greatest need, those at the lowest end of the income scale, were taken
care of, and I’m going to talk about the low-income benefit.

Secondly, they wanted to be sure that people who had very high drug
costs were taken care of. And third, we wanted to provide incentives to
employers who provide retiree coverage to stay in the game, not to
continue this trend that we’re seeing in which employers drop coverage.
So let me deal with those three areas and then I’ll talk about the basic
benefit itself that will apply to everyone.

With regard to low-income people who are at or below the federally
defined poverty level, those folks have to pay no premium, they have no
deductible, there is no gap in coverage. They get coverage from the first
dollar up through whatever they have to spend, and all they face are
co-payments of $1 for a generic drug or $3 for a brand-name drug. So for
those at the very bottom of the scale, the coverage is actually excellent.
It’s virtually first-dollar coverage with the exception of very modest
co-pays.

The next level is defined as 135 percent of poverty, and people between
100 percent of the poverty line and 135 percent of the poverty line have
essentially the same deal that I’ve just described: No premium, no
deductible, no coverage gap, no cap, and they have to pay co-payments
of $2 for a generic drug or $5 for a brand-name drug.

For those between 135 percent of poverty and 150 percent of poverty as

federally defined, there is no premium. There is a $50 annual deductible.
The co-payments are 15 percent of the cost of the drug, and there is no
coverage gap.

All these co-pays are subject to asset tests. If a couple has assets of up
to $9,000 they have the lowest co-pays. If their assets range from $9,000
to $20,000, they have higher co-pays. And couples with assets of more
than $20,000 will pay the highest co-pays. This asset test will affect about
12 percent of the people in the low income categories.

So one thing we’re pleased with is the low-income benefit, which is really
quite generous and should allow people who are poor or near poor to get
very good coverage of the drugs that they need.

I also said that the Congress made a very good-faith effort to try to take
care of those who have very high prescription drug costs. And essentially
above $3,600 in out-of-pocket costs, Medicare will pick up 95 percent of
whatever remains. To give you a sense of what this means, one example
would be that-let’s take someone who has no drug coverage now and has
$10,000 in prescription drug costs. If he has no coverage now, he is
paying that full $10,000. Under this legislation he is paying about $4,000
and Medicare is picking up the other $6,000.

The subsidy that’s provided in this legislation to employers to continue to
provide good benefits is very important to us. Some of those employer
plans offer a more generous benefit than is available in this package, and
we want them to continue to do that. Right now employers are allowed to
deduct the costs of those plans from their adjusted gross income, so they
have a bit of a tax incentive to do it.

This bill, on top of that, adds a subsidy that pays 28 percent of the
actuarial value of the drug benefit they provide, between $250 and
$2,250. So that’s pretty generous right there. It reduces their cost by
about a third.

In addition, this bill makes that subsidy tax free, so that actually adds
something. We are hopeful that this will keep those employers in the
game in continuing to provide the kind of benefits that they provide now.
And I should add, because there have been some expressions of
concern, that that subsidy covers not just employers in the private sector
but employers in the public sector as well.

So a state government employee or a teacher or anyone else who has
retiree benefits through their public employment, those employers will
receive the same incentive to continue to provide those benefits, as do
private employers. And I think that’s very important.

Now let me go to the shape of the benefit for people who are not in the
lower-income categories that I described. Once again, this is not as
generous a benefit as we would like. What we will see in this legislation,
which takes effect in the year 2006, is a premium that will average $35. It
may vary slightly depending upon the health costs in your particular
region of the country but it should be $35 a month. In addition, they will
have a $250 deductible. Once they have met that deductible of $250, from
there up through $2,250, Medicare will pick up 75 percent of the costs of
their prescription drugs. So it’s pretty good coverage up too there: three
out of four dollars will be reimbursed.

Most of this bill does not take effect until the year 2006, as I said. People
don’t have to make a decision until sometime in the fall, maybe
November, of the year 2005. So they will have plenty of time to think
about this and decide whether or not it makes sense for them. At AARP
we’re committed to continuing to provide additional information that
people may want to take into account in making that decision.

And we actually have on our website now a quick benefit calculator that
will let people interactively plug in the amount of what they expect their
drug costs to be and then it will give them a sense of how much
reimbursement from Medicare they will get under this legislation. And I’d
urge folks to use that; it may save them a lot of pencil-and-paper work.

That calculator is very accurate. If you put in the amount that you expect
to spend, it will tell you how much of that will be covered. Of course, the
more difficult estimate is what you expect to spend. You’ve got to look at
this a bit on the insurance principle. So people may want to feed in not the
amount that they’re spending now but the amount they want to protect
themselves against with some coverage in the years ahead in making
their decision.

There are a few provisions of this legislation that will actually go into effect
this year. A drug discount card will be available. We haven’t seen the final
details on this. My guess is that that will give people about a 15 percent
saving off retail price on the drugs they buy. That card should cost about
$30. Once again, this decision is up to the individual.

Some people may be able to get drug discounts through other vendors
outside of the Medicare approved ones that are just as good, and if so,
they may want to take a pass on that. It’s their decision. But I think for
low-income residents, for low-income beneficiaries, there is an additional
feature that makes this very good protection for them, and that is both for
the 2004 and 2005, the low-income beneficiaries will receive a $600 credit
on that card. It’s like a debit card for those folks. They have $600 and can
use that $600 to pay for their prescription drugs bit by bit until they
exhaust the $600, and then they’ll get the 15 percent discount.

On balance we think this benefit was well worth supporting. We think it is
a good start to where we have to go. We think it will provide good
immediate relief for low-income beneficiaries and for those with very high
drug costs, and there will be some coverage for everyone else in the
beneficiary population. If you spend, for example, in the course of the
year, about $3,000 on prescription drugs, after 2006 you’ll get about
$1,500 of that covered, and that I think makes it worth doing at that level.

So, on balance, great start. We’ve been trying to get this for more than 10
years. Congress has rolled the boulder up the hill several times only to
have it slip away, and I think we finally got it over the hump and it can only
get better from here.

Our goal is to make prescription drugs more affordable and this is one
major piece. It’s a piece that we’re going to try to improve over time, but
the other thing is we’re going to be working on a lot of other things to try to
make prescription drugs more affordable for seniors, any number of
things: free notification plans, bulk buying plans, trying to help
reimportation workable.

So I want you to know we’re going to continue this and we’re going to
continue trying to fight to make prescription drugs more affordable.

Dr. Olsen thanked the committee for allowing him the opportunity to meet
with them today.

The purpose of this bill is to delete county jails and state correctional
facilities from the requirements of the Idaho Food Code. This code,
enforced by the Idaho Department of Health and Welfare, is designed to
apply to restaurants and other private and public food service entities.
State correctional facilities and county jails have their own rules and
regulations pertaining to service of food within correctional facilities and
jails that are better designed to meet their needs. Implementing Health
and Welfare rules on food service would create a significant financial
burden on the state and on county governments that would require
additional funding from the state general fund and local property
taxpayers. This bill will avoid that unnecessary burden.

This bill has no adverse impact on the general fund or on county budgets.

16-0309-0305

To promote and protect the health and safety of Idahoans the Department
is committed to continually improving systems and process used to
identify the right level of care and services required by Medicaid
participants in Nursing Facilities.

The Uniform Assessment Instrument is the tool used by the Department
to assess whether or not a participant requires Nursing Facility level of
care. This tool is criteria based, objective instrument that reflects the
participants’ physical and mental functional capacity and limitations.

The scoring system for the Uniform Assessment Instrument was
quantified for scoring levels of care for supervision. The rules are being
amended to reflect current practice and to assure services on the Uniform
Assessment Instrument are consistent. This change will promote
consistency throughout the Department and help assure those
participants are receiving the level of services they require.

This rule docket was published in the August Administrative Bulletin. Two
positive written comments were received. Legislative Services had no
technical, substantive, or procedural concerns with these pending rules.

This concludes my presentation on rule docket 16-0309-0305. I
respectfully ask the committee to adopt this pending rule as final. I will be
glad to answer any questions from the committee at this time.

16-0309-0309

The purpose of this docket is support the January 20, 2004 Department’s
commitment to providing both the right price for services and the right
services for participants. Additionally, we want our rules that govern our
services to be clear to all stakeholders. This docket includes two different
Sections of the Medical Assistance rules, Section 121 and Section 146.

Idaho Medicaid has used the same reimbursement methodology as
Medicare for Ambulatory Surgical Center. Medicare has recently changed
their methodology for reimbursing these facilities and this change is not
compatible with Idaho Medicaid’s automated system. The Department will
continue to use the historic reimbursement methodology instead of the
new Medicare methodology. The reference in Section 121 of the rule to
Medicare’s methodology has been deleted.

The second section of rule being addressed in this docket deals with
Personal Care Services. Section 146 of the Medical Assistance rules,
was deleted completely and the entire section was reorganized and
rewritten in plain language based on ongoing input of staff and provider.
In response to public comment a new subsection was added to permit
agencies to use a software system allowing personal assistants to
register their start and stop times and maintain a list of services they
provide by placing a telephone call to the agency system from the
participant’s home. This does not replace the documentation
requirements of these rules.

This rule docket was published in the October Administrative Bulletin.
Legislative Services had no technical, substantive, or procedural
concerns with these pending rules.

This concludes my presentation on rule docket 16-0309-0309. I
respectfully ask the committee to adopt this pending rule as final.

16-0309-0307

16-0313-0301

16-0323-0301

16-0411-0301

16-0417-0301

These dockets all relate to the new chapter of rules provides a
coordinated and comprehensive process for Idaho Medicaid to prior
authorize Developmental Disability (DD) program services for eligible
adults.

• 16-0323-0301 – This rule change supports the implementation of
  the Department’s new prior authorization process for
  Developmental Disability (DD) services. The rule change identifies
  the standard for the Department to assess individuals with a
  developmental disability for determination of eligibility and
  participant budget for services.





• 16-0411-0301 – These rule changes support the implementation of
  the Department’s new prior authorization process for DD services.
  The rule changes establish the requirement for Developmental
  Disabilities Agencies (DDAs) to obtain prior authorization for DDA
  services for all adult participants. They also require DDAs to
  submit Provider Status reviews semiannually and annually.





• 16-0417-0301 – These rule changes support the implementation of
  the Department’s new prior authorization process for DD services.
  The rule changes establish prior authorization for Residential
  Habilitation Agency services. They also require Residential
  Habilitation agencies to submit Provider Status reviews
  semiannually and annually. In response to comments received
  from the Board of Health and Welfare, testimony presented at
  public hearings, and written comments submitted by the public and
  Department staff, several clarifications and additions were made to
  the temporary rule. This is a companion docket to 16-0313-0301.

MOTION:

EXCUSED:

16-0309-0308

No public hearings were held. Two (2) positive written comments were
received.

This docket of temporary and proposed rule deletes section 204 (pg.268)
which describes the Surveillance and Utilization Review (SUR)
Committee. This committee functioned to review instances of suspected
fraud, abuse, and misconduct and make recommendations concerning
corrective actions such as suspension of payments or provider
agreements. We maintain that the deletion of this section in these rules
removes “an important check and balance necessary for making critical
judgments that may tremendously impact the very existence of provider
entities that are the subject of such allegations, and the livelihood of the
people they employ in reliance on their provider agreements.

Section 208 (pg. 269) Suspension of Payments Pending Investigation has
been amended to state “The Department may suspend payments in
whole or in part in a suspected case of fraud or abuse pending
investigation and conclusion of legal proceedings related to the provider’s
alleged fraud or abuse.”

“Suspect” is defined in Webster’s dictionary as “To consider to be guilty
without proof.”

“Alleged” is defined as “To assert without proof.”

Section 208.01 Basis of Suspension of Payment states in part “When the
Department through reliable evidence suspects fraud or abuse . . .
Medicaid payments may be withheld or suspended.”

Since the determination of what constitutes “reliable evidence” at the

investigation stage is a subjective determination at best, and the
Surveillance and Utilization Review (SUR) Committee in section 204 has
been deleted in this set of rules, these judgments will be at the sole
discretion of the investigators alone. It is entirely reasonable to expect that
the investigation team be required to appeal to a higher objective authority
in providing sanction for these very critical suspensions. This not only
serves to protect the rights of those accused, but also serves to protect
and ensure the impartiality, accountability and credibility of the
investigation’s unit.

These rules also delete section 210 (pg. 269) which provides a process
for Appeal of Immediate Actions such as suspension of payments or
provider agreements. This section stated “the Department shall provide
for a hearing within thirty (30) days of receipt of a timely filed notice of
appeal.” Section 224 of these rules clarify that appeals will be governed
under the “Rules of Contested Case Proceedings and Declaratory

Rulings” in IDAPA 16.05.03 . . . As far as I can tell, there is no
requirement for the Department to provide a hearing within any specific
period of time. We believe that access to timely appeal hearings are also
an important check and balance to ensure appropriate protections against
arbitrary, capricious and dictatorial enforcement actions. Many providers
would be financially ruined and unable to recover from these
administrative processes within a few weeks let alone a month or more.

The way in which these pending rules are structured allows for the
possibility that a provider accused of committing fraud or abuse could be
summarily put out of business based on an unsubstantiated charge with
no real recourse or due process rights during the interim. We suspect that
there are many more instances of unfounded charges of fraud than
complaints that ultimately result in convictions.

In summary, we agree that suspensions are in order in cases where a
provider refuses to provide investigators with relevant records necessary
to conduct their investigation. We have been under the understanding that
this was a fundamental requirement of a provider of Medicaid-funded
services all along. This refusal is an overt act that is an incontrovertible
fact, as opposed to an unsubstantiated allegation. We disagree with the
removal of timely due process protocols described in sections 204 and
210. We respectfully request that this committee amend this rule to
restore sections 204 and 210. We also request that sections 208 and 209
be amended to require the approval of the Surveillance and Utilization
Committee in cases where suspension of payments or the provider
agreement are determined necessary to avoid immediate danger to the
public health and safety. This concludes my prepared presentation on this
docket.

Discussion: The motion as presented does not kill Docket 16-0309-0308,
and a further review will be conducted at a later time.

The motion was carried by a voice vote.

16-0310-0203

reimbursement. The department requests that you, adopt this pending
rule as final. Your committee approved this docket last year as

temporary.

As a result of the Governor’s 3.5% holdback, we are paying hospitals
3.5% less each month. The Department is requesting that the Committee
approve this Pending rule as final.

16-0310-0204

approved this docket as temporary, last year and the department

would now like you to adopt this pending rule as final.

This rule changes how Medicaid pays for wheelchairs for residents of
Intermediate Care Facilities for the Mentally Retarded, also known as
ICFs. This rule was changed following negotiations between the
Department and the ICF industry.

Medicaid -under these rules- directly pays Durable Medical Equipment
Suppliers instead of paying the ICFs who previously purchased the
wheelchairs. This change has three positive effects:

It eliminates the cash flow problem experienced by small ICFs when a
resident requires a highly specialized and expensive wheelchair.

Since Medicaid purchases wheelchairs directly from the suppliers,

costs are reduced because Medicaid reimbursement is less than the retail
prices that ICFs paid.

The participant is more readily accepted for admission into the small
facilities and keeps the wheelchair, no matter if he moves between
facilities or into a community placement.

The Department is requesting that the Committee to approve this

pending rule as final.

16-0310-0301

This rule explains that out-of-state nursing homes are reimbursed using
the same rate they receive from the Medicaid program in their home state.
Other minor clarifying language has been added to improve
understanding of this reimbursement section.

In addition, this docket incorporates Title 42 of the Code of Federal
Regulations, Part 447, entitled “Payment for Services,” and the Medicare
Provider Reimbursement Manual into these rules.

16-0310-0302

This docket changes how monthly Medicaid payments are paid to
hospitals in order to lessen the effect of overpayments and under-payments. The change will improve the accuracy of payments during the
course of the year rather than waiting until cost settlement which often
occurs two-years after the interim payments are made. The change will
improve cash flow for the Department.

The change only affects those hospitals where payments vary by more
than $100,000 on their most recent cost report. The Department is
requesting that the Committee approve this rule.

16-0310-0303

reimbursement methodology. The department requests that this
committee adopt this pending rule as final.

This rule clarifies four sections in Chapter 16.03.10. The first section
clarifies the occupancy adjustment factor. The clarification is to specify
that the property rental rates are not included in the total property costs
for the occupancy level calculation.

The second section clarifies the extension of the effective date for a
special rate.

The third section clarifies that all financial reports are subject to audit.

The last section clarifies the process regarding amending
Disproportionate Share Hospital surveys, otherwise know as DSH.

16-0317-0301

the Department is seeking your approval of docket 16-317-0301. This
docket is being presented as a pending rule and applies to Medicaid
policy for case management services referred to as service coordination.

This docket is a rewrite of the current four (4) sections of Medical
Assistance rules pertaining to case management services for Individuals
with Developmental Disabilities; individuals receiving Personal Care
Services; Individuals with Mental Illness, and for children who meet
certain medical criteria.

The rewrite of these rules combines all four (4) sets of rules into one
section. The combination and standardization when possible of all rules
governing case management services reimbursed by Medicaid is part of
our effort to make our rules more consistent, understandable and
accessible to providers.

The chapter defines the requirements for all common functions of case
management as well as specific requirements for each type of eligible
participant group. This includes eligibility requirements; case management
functions; availability and access to services;

provider qualifications; agency responsibilities; required documentation
and payment for service limitations.

This rule rewrite was developed during a negotiated process that
involved:

1. Medicaid participants who receive each of the four types of case
management services;

2. Case management and other interested provider associations;

3. Advocacy groups

4. Individual Service Coordinator’s from Service Coordination agencies.

This concludes my presentation to the Committee on this docket. I
respectfully ask the committee to adopt this pending rule as final.

EXCUSED:

16-0311-0101

I am before you today to review a temporary rule Docket Number
16-11-0101. The Department is asking to be extended for a year.

This temporary rule sets a cap on beds in community intermediate care
facilities for persons with mental retardation at 486 beds. Of that 486, 12
are reserved for time-limited emergency use.

The Department is before you requesting extension of the ICF/MR bed
cap for another year.

The Department consulted with the Idaho Association of Community
Options and Resources, the ICF/MR association, and there is no
objection to this request from the association. I am not aware of concerns
from any other group.

16-0322-0301

We are requesting that the committee recommend adoption of these
pending rules.

There are three changes to these rules:

Subsection 428.01 is being amended to cite to the Board of Nursing rules
without referencing specific sections due to changes made to those rules.

Subsection 428.02 is being amended to delete a process which conflicts
with the Board of Pharmacy rules.

During the 2003 Legislative session House Concurrent Resolution 17
asked that the Department and the Board of Pharmacy develop rules to
allow the return of unused, unopened medications to the dispensing
pharmacy for credit. Stakeholders (Trade Associations IDALA, IHCA,

and Pharmacy) and providers were involved in the development of the
process and rules.

Subsection 428.04 is being amended to allow residential care and
assisted living facilities to return unused or unopened medication to the
dispensing pharmacy for credit.

The Residential Care Council for the Elderly and the Board and Care
Council voted unanimously to support the rules during the October
meeting.

The Board of Health and Welfare approved the rules in their November
meeting.

There were two positive comments received. No negative comments and
no request for hearing. We respectfully request that the committee
recommend adoption of these pending rules.

Michelle Glasgow , executive director of the Idaho Assisted Living
Association testified the Association does support the rules with some
clarification. The Association has concerns with Section428.02,
Medication Distribution System – Each facility shall use Medi-sets, or
blister pack, or other system as approved by the department. The
Medication System must be filled by a pharmacist and appropriately
labeled in accordance with pharmacy standards. “A licensed nurse may
fill Medi-sets which must be appropriately labeled with medication name,
dosage, amount and time to be taken, and special instructions if
appropriate.”

Jim Alexander, a pharmacist from Mountain Home, testified in support of
the deletion of that section of the rule. He explained the liability involved
and the responsibility of a pharmacist in repackaging medications.

16-0309-0214

The purpose of these pending rules is to improve and protect the health
status of our participants through the provision of quality care. These
rules will allow Medicaid to provide our participants with the most effective
drug at the right price through a variety of pharmacy management tools.

Idaho Medicaid, like many other state Medicaid and commercial
pharmacy benefit programs, has implemented a variety of pharmacy
management processes . . . tools. These common management

strategies include generic substitution requirements, prior authorization of
drugs and coverage limitations like limits on quantities per prescription
and early refills. This rule docket provides for the tools that support
appropriate management of the Medicaid pharmacy program. These

pharmacy management strategies are already standard practice in
commercial health insurance plans.

These rule changes also allow Medicaid to make decisions based on
objective scientific information. This objective scientific information
(commonly referred to as evidence-based reviews) will provide the clinical
foundation and support for our pharmacy management processes.
Medicaid will encourage the use of effective medications at the best price
through these management tools. The purpose of this rule docket is
appropriate access.

In December 2003, Medicaid processed nearly 217,000 prescriptions.
Less than 1,400 required any type of prior authorization. Less than one-half of 1-percent of the prescriptions processed through Medicaid.
Approximately 75 percent of those that needed prior authorization were

approved.

Idaho paid $128 million for Medicaid prescription drug benefits in fiscal
year 2003. In fact, Prescription drugs were the second most expensive
Medicaid benefit following hospital services and accounts for 15% of the
Medicaid budget. However, the combined effect of these rule changes
helped to avoid an estimated $20 million in pharmacy costs in state fiscal
year 2003 and an overall cost avoidance of $32 million in pharmacy costs
since 2002 when these rules were initiated.

Amendments to the temporary rule docket were made following legislative
approval. The amendments are based on comments received in the
public hearing, testimony presented before the Senate Health and
Welfare Committee and negotiations during the 2003 Legislative session.
For example, as requested the Department has included two new
subsections that provide for a 72-hour supply of a covered drug in an
emergency and states that the Department will respond within 24 hours to
a request for prior authorization.

These rules provide important tools that allow us to continue the delivery
of quality care to our Medicaid clients by providing the most effective drug
at the right price. Overall these rules will help Medicaid improve the health
of our participants by delivering quality care and managing costs.

The Department requests that the Committee approve the rules in Docket
16-0309-0214 as final.

Stan Gibson, a pharmacist in Nampa and past president of the Idaho
Pharmacy Association, testified to support Docket 16-0309-0214.

Rick Sutton, a pharmacist for Shopko stores, testified to support Docket
16-0309-0214, and requested the committee to approve the rules.

Clyde Dailey, state director for AARP Idaho, testified and submitted the
following written comments.

Jim Alexander, an independent pharmacist in Mountain Home, testified
in support of Docket 16-0309-0214.

Clyde Dailey testified and explained that on behalf of AARP Idaho’s
150,000 members I wish to thank you for this opportunity to testify before
you today. AARP has long advocated for quality medical care. As the
Committee is well aware, prescription drugs are an integral factor in the
effective treatment and prevention of disease. As such, there is a wide
range of drugs available which purport to treat the same condition.

After careful review of Idaho Department of Health and Welfare Medicaid
rules that will permanently establish its Enhanced Prior Authorization
Program, AARP Idaho supports this rule. This unbiased, scientific
approach identifies the most effective drugs in today’s health care market
and protects the safety of the consumer.

Jim Baugh, executive director of CO-AD (Comprehensive Advocacy
Group), testified about Docket 16-0309-0214 and Docket 16-0309-0303 at
the same time. He did not ask the committee to reject the pharmacy rules,
but did sound a cautionary note about this particular type of activity. He is
concerned about the increased cost of drugs and prior authorization.

Dan Fuchs, submitted the following written comments to support the
pharmacy rules: His written comments are:

I am a member of the Idaho Board of Health and Welfare, and I have
been a licensed pharmacist in Idaho for 17 years.

My family owns and operates five (5) pharmacies in the Twin Falls area.
Our five pharmacies serve thousands of Medicaid clients annually, and
that number grows every year. I have watched Idaho Medicaid struggle to
meet the rapidly increasing demand for prescription medications. And, I
have watched the cost of those medications rise just as quickly.

Medicaid has correctly recognized, in my opinion, that only a carefully
managed pharmacy program can effectively deal with this problem.
Medicaid has taken steps that will give the state the opportunity to
manage costs and still make sure Medicaid patients receive the important
medicines they need.

I urge the committee to approve the rules that allow the Medicaid
Pharmacy Unit to manage the prescription program.

One of the issues you are looking at is the rules’ docket for operation of
the prior authorization program. The prior authorization program creates a
little more work for me, but the value I get from the program, as a
taxpayer and a pharmacist, is far more important. The prior authorization
helps Medicaid manage costs and still deliver needed medications for
clients. I do not see it as a roadblock to good health care, but using the
same practices as private health insurers.

The prior authorization process is fast and barely noticeable to my
customers. Medicaid pharmacists are quick to respond if there are
problems.

I understand that the program has saved the Department millions of
dollars. I ask that you support this important program by approving the
rules before you today.

Jeffrey K. Edwards, MD, St. Mary’s Clinic in Cottonwood, submitted
written comments to support of the pharmacy rules. His written comments
follow:

As a licensed family practice physician here in Idaho, I strongly urge you
to support the proposed pharmacy rules currently under review by the
committee.

As a doctor in a small rural Idaho community, I want to talk to you briefly
about the importance of a Medicaid pharmacy prior authorization
program. You may know it as the Enhanced Prior Authorization Program,
but whatever its title, it is extremely valuable to me as a physician and
most importantly to my clients.

The pharmacy rules for the Enhanced Prior Authorization Program
(EPAP) ensures the best health outcome for Medicaid clients by selecting
the most effective drug at the right price.

The prior authorization program has three main components:

• Evidence-based clinical review process
• A pharmacy and therapeutics committee
• An automated system called SmartPA that reviews prior
  authorization requests in seconds, making the process quick and
  convenient to pharmacists and doctors; and transparent to the
  Medicaid client.

The prior authorization program is a tool, working in conjunction with the
Pharmacy and Therapeutics Committee, prior authorization gives health
care professionals, like me, the information we need to ensure that
Medicaid clients receive quality care at the best price. It provides
physicians with the latest research on the efficacy and safety of drugs. It
promotes something we call best practice medicine . . . or the best use of
pharmaceuticals in patient care. And, it still provides me with the flexibility
to prescribe the medicine my patients need.

The Division of Medicaid has made successful efforts to streamline the
prior authorization process. In fact, virtually all my prescriptions for
Medicaid clients pass through the system without delay. If a prior
authorization is needed, it only takes minutes to submit the necessary
information for the request.

I strongly encourage you to support this program because it provides the
basis for quality care at the right price for Idaho’s Medicaid clients.

16-0309-0303

I am here today to present pending rules regarding the Medicaid

Pharmacy Program in Docket 16-0309-0303. The Department is
requesting these pending rules be approved as final.

One of the Department of Health and Welfare’s goals is to improve the
health of Idahoans. Medicaid provides services to some of the most
vulnerable Idaho populations–elderly, children, and people with
disabilities. The goal of the Medicaid Pharmacy Program is to provide
quality care to Medicaid participants with the most effective drug at the
right price. This rule change promotes the health and safety of Medicaid
participants by assuring that objective research plays a primary role in our
prescription drug program.

The rule supports the use of the most current expert objective research.
This objective research, also known as evidence-based reviews,
compares the relative safety, effectiveness and clinical outcomes of
medications within a group of similar medications or drug class.

Evidence-based information allows the Department to make prior
authorization and other program related decisions based on good
science. Idaho Medicaid has joined with other states and countries to
obtain current evidence-based drug class reviews from the Center of

Evidence-based Policy at OHSU. Dr. John Santa will provide further
information regarding the Drug Effectiveness Project in a moment. The
main point is that the use of national credible evidence-based reviews
allows the Department to “globalize the evidence and localize the
decision.”

To localize the decision, the Department builds on the knowledge and
expertise of fellow Idaho medical practitioners. This rule describes the
membership, appointment and responsibilities of the Medicaid Pharmacy
and Therapeutics Committee. This Committee is made up of practicing
Idaho physicians, pharmacists, and health care practitioners (such as

Nurse Practitioners or Physician Assistants) who currently prescribe
medication for our Medicaid clients. One of the Committee’s roles is to
make recommendations to the Department regarding the Enhanced Prior
Authorization Program. Specifically, this Committee recommends which
medications will not require prior authorization within a group of equally
effective medications; thus, localizing the decision of the most effective
drug after a global evidence-based review.

Additionally, in an effort to obtain the right price for medications paid for
by Idaho Medicaid, this rule adds guidelines for a supplemental rebate
program. Supplemental rebates will enable the Department to purchase
prescription drugs in a cost-effective manner. Supplemental rebates will
be in addition to rebates Medicaid currently receives. Supplemental
rebates allow for price competition to occur after a thorough scientific

( evidence-based) review.

This rule change is based on comments made during the Public Hearing,
2003 Legislative rules presentations and meetings with a Legislative Task
Force regarding the previous Docket No.16-0309-0214, dealing with
pharmacy management tools. This rule was amended in response to
information received during the comment period and consultation between
the Legislative Task Force and Department staff.

Above all, through the use of evidence-based practices, establishment of
a Pharmacy and Therapeutics Committee, and a supplemental rebate
program, we will assure that objective research plays a primary role in our
prescription drug program. Our program provides Medicaid participants
with the most effective drug at the right price. The Department requests
that the Committee approve the rules in Docket 16-0309-0303 as final.

John Santa, MD, a specialist in Internal Medicine testified and presented
a project overview of drug effectiveness, a project of the Center for
Evidence-based Policy, Oregon Health and Science University.

Dr. Santa explained he spends most of his time on the project, the Drug
Effectiveness Review Project that I would like to briefly familiarize you
with.

This project provides Idaho and other participating organizations with the
most current, comprehensive, rigorous review of evidence regarding the
comparative effectiveness and safety of selected prescription drugs. It
does so in a way that is independent, scientific, and objective enabling
local decision makers to evaluate all of their decision options.

The project is a collaboration of private and public purchasers, like Idaho,
who think it best to do this information gathering step together. Each
Participant, including Idaho, has a vote in selecting the drugs to be
reviewed and identifying the key questions regarding these drugs. The
project will be guided throughout by local decision makers with input from
stakeholders in their state or organization.

The Center for Evidence-based Policy provides support to the Project by
facilitating the collaboration, including contracting with Evidence-based
Practice Centers to review and report on the drugs and key questions
identified. Evidence-based Practice Centers (EPC) are designated as
such by the federal government (Agency for Healthcare Research and
Quality) as centers of expertise in studying important and difficult health
issues in an independent, scientific, objective way. The EPC searches
and sifts the world’s information bringing order to what otherwise can be a
very chaotic and complex process.

Let me share an example of the sort of information dilemma facing all of
us that this process better informs. See ACP Journal Club, January 2004,
“Carvedilol was more effective than metoprolol tartrate for lowering
mortality in chronic heart failure.”

I have attached a more detailed paper summarizing the key elements of
systematic reviews. Such a review would find as many studies as possible
like the one I have just shown you, look at all the important details in each
of those studies and synthesize them. The Project would also update the
reports every six (6) months to keep the information current. The
commitment to regularly update is unusual in American scientific efforts.
Additional detail is also attached on the process for systematic reviews.
(See Attachments #1, #2 and #3)

Clyde Dailey, state director of AARP, testified to support Docket 16-0309-0303.

Peter Kozisek, MD, medical director of the Family Practice Medical
Center in Boise, testified to support Docket 16-0309-0303. He has been
very impressed with the work Medicaid has done throughout the past
several years on this program. He has found the Medicaid staff very
helpful, very efficient, and very accessible to physicians. The department
has a very efficient and cost-effective Medicaid unit.

Roseanne Hardin, J.D.,LSW, submitted the following written comments:

As the current chair of the Board of Directors of the National Alliance for
the Mentally Ill-Boise Affiliate, NAMI-Boise, I am writing to recommend
that your committee not approve the above identified temporary and
proposed rule as proposed by the Department of Health and Welfare as
written. Our organization, made up of consumers of mental health
services and family members of persons with serious and persistent
mental illness, has grave concerns that this move to a prior
approval/formulary approach will place persons in danger, and in so
doing, greatly increase the cost of medical services required by these
persons.

As you know, nearly one in five Americans at some point in their lives will
be personally impacted by mental illness and nearly all of us have a family
member or close acquaintance who is negatively impacted by mental
illness. We all know that mental illness is caused by a chemical imbalance
in the brain. We no longer believe mental illness is caused by bad
parenting or lack of will power or initiative. The additional good news is
that treatment, including psychotropic medications, do work and recovery
is possible.

Older psychotropic medications, which are less costly, even when
seemingly chemically effective, do generally have significant side effects
which impact the patients’ ability to tolerate the drug. People cannot
tolerate these side effects and stop taking these drugs. Newer
generations of medications are often more tolerable to patients as they do
not result in the patient being “spaced out,” fidgety, without sexual drive,
and lessen the very common weight gain which may be dangerous to
physical health. No medication works if it is not taken by the patient.

We at NAMI-Boise request that the proposed rules be amended to create
a “mental health carve out” that would allow for final determination in the
prior approval process to be left with the prescribing medical care
provider, the individual who actually knows and works with the patient.
Absent this fundamental patient-care provider right, it is likely fewer
persons with mental illness will take, tolerate, and thus benefit, from the
medications covered by Medicaid for their mental illness.

Medications that are not taken are a waste of money. Psychiatric
crises that may have been avoided with appropriate medications, and the
ensuing cost to all community, county and state systems are also a waste
of money, but more significantly, a waste of human dignity and spirit.

It is recommended that the sections of Medicaid rule addressing prior
authorization of pharmaceuticals in IDAPA 16.03.09.810.e and 814 be
amended to create a “mental health carve out” which would allow final
determination of the appropriateness of Medicaid covering the cost of the
prescription be retained by the care provider who prescribes the
medication, not the P&T (Pharmacy and Therapeutics) committee or a
physician employed by the state agency.

It is certainly recognized by NAMI-Boise, that the Legislature has a duty to
be prudent in the approval of publicly funded medications for persons in
our State. The Legislature also has the duty to be compassionate and
wise; two values not conflict in this instance. To be effective, medications
must be able to be tolerated. If you have a loved one with mental illness,
the best medication is the one that is effective to control symptoms and
not create side effects that can’t be tolerated.

Please consider these issues in review of these rules.

16-0611-0301

This docket had no hearings and two positive comments. The intent of
these rules will make them more consistent and understandable, in
particular by adding clarification around the word parent and certified
adoption professional.

We had made some changes to the word parent in a previous docket
through an omnibus clerical correction. Upon further review we needed to
add better language around the word parent and other grammatical
changes were incorporated. The addition of the term certified adoption
professional was added and clarifications of the sections related to that

term was edited. Again, I would ask that the committee consider adopting
these pending rules as final.

16-0601-0401

chart on page 82, there is a modest increase in the rate foster parents are
reimbursed for the care they provide to the state’s most vulnerable
children. Although financial incentives are not the most important factor in
recruiting and keeping foster parents, and Idaho’s rates are still below the
national average, your efforts at increasing the reimbursement rates are
appreciated by Idaho’s foster parents.

I would again ask that the committee consider extending these temporary
rules.

EXCUSED:

If adopted, the Senate and House of Representatives concurring therein,
that IDAPA 16.03.01, Sections 346, 347, 348 and 349, rules of the
Department of Health and Welfare relating to eligibility for Medicaid for
families and children, adopted as pending rules under Docket Number 16-0301-0302, be, and the same are hereby rejected and declared null, void
and of no force and effect. This concurrent resolution has no fiscal impact.

The purpose of this bill is to delete county jails and state correctional
facilities from the requirements of the Idaho Food Code. This code,
enforced by the Idaho Department of Health and Welfare, is designed to
apply to restaurants and other private and public food service entities.
State correctional facilities and county jails have their own rules and
regulations pertaining to service of food within correctional facilities and
jails that are better designed to meet their needs. Implementing Health
and Welfare rules on food service would create a significant financial
burden on the state and on county governments that would require
additional funding from the state general fund and local property
taxpayers. This bill will avoid that unnecessary burden.

This bill has no adverse impact on the general fund or on county budgets.

Richard Schultz, Administrator of the Division of Health for the
Department of Health and Welfare testified and had no objection to
SB1215.

16-0603-0301

He explained he is here to discuss Docket 16-0603-0301 with pending
changes to the Rules and Minimum Standards Governing Alcohol/Drug
Abuse Prevention and Treatment Programs. He explained, I am asking
you to adopt these pending rules as final.

Our mission at Health and Welfare is to promote and protect the health
and safety of Idahoans . . . in my part of the department we focus on
substance abuse. A year ago, this committee approved temporary rules
that standardized treatment for Drug Court participants. These rules are
now accepted in courts and communities across the state.

We distributed the temporary rules to all approved alcohol/drug treatment
providers, drug court coordinators and trial court administrators. We
received two (2) comments throughout the year that did not necessitate
additional changes to the rules.

We are excited about our partnership with the Idaho Supreme Court to
continue the success of the Drug Court Program in Idaho. We again ask
that you adopt these pending rules as final.

16-0613-0301

and

16-0613-0302

Community Services, Department of Health and Welfare.

She explained, I am here today to present rule changes to Docket
Number 16-0613-0301, a pending rule for which I am seeking adoption of
the repeal of the entire chapter. Docket 16-0613-0302 is the pending rule
for which I am requesting adoption and final approval for Emergency
Assistance for Families and Children. No hearings were held and no
comments were received on these rule changes.

Part of our mission at Health and Welfare is to prevent child abuse,
neglect and out-of-home placement of children. This non-substantive rule
change helps us do that by standardizing the use of Emergency
Assistance funds we use to help families address immediate crises that
put children at risk.

First, the pending rules will allow direct service providers in all Department
programs, not just licensed social workers in Children and Family
Services, to authorize these one-time funds on behalf of families. This
expedites the responsiveness of the Department to resolve the families,
emergency conditions, precisely when timeliness is critical to child safety
and well-being. This also increases our ability to intervene early and divert
families from a longer term and more intrusive services such as Child
Protection or Temporary Assistance.

Additionally, these rules specify the types of Emergency Assistance
services that are to be available statewide. This clarification assures that
children at risk and their families receive individualized services, based on
their presenting needs and it assures that this array of emergency
services is consistently available, regardless of where the family lives in
the state.

The Department of Health and Welfare is charged with providing families
in crisis with timely, appropriate and accessible services in order to
preserve the safety and stability of vulnerable children. The rule changes
and clarifications before you will help us in achieving this important

outcome.

16-0614-0201

16-0501-0301

and

16-0501-0302

This pending rule, Docket 16-0501-0301, pertains to the protection and
disclosure of the Department’s records. This docket repeals the current
chapter of rules and is being rewritten in Docket 16-0501-0302, which will
comply with HIPAA (Health Insurance Portability and Accountability Act)
requirements.

Dr. Payne explained this Docket 16-0501-0302, is a pending rule and is
adopting a new chapter of rules to govern the disclosure of Department
records. The new rules specifically comply with HIPAA requirements.
These rules have been extensively reviewed and in some cases amended
after they were initially published in April as temporary rules. Access to
documents is extensively regulated by state and federal law. These rules
implement those laws.

EXCUSED:

Docket No.

16-0614-0201

This rule was presented to the Legislature during the previous session as
temporary. I am here today to ask you to adopt the pending rule as final.

Three hearings were held on these rules. There is a typographical error
on the summary page in you binders. All hearings were held in December
2002. No written or verbal comments were received.

The first change in the rules is to require permittees to pay outstanding
fines prior to renewal of the annual permit. The state auditor
recommended this change be made to improve the rate and timeliness of
fine payments. The change will increase permittee awareness of the

law, and the need to comply with the law.

A technical change was also made changing the date used in the formula
to determine the number of inspections.

I request that you adopt these pending rules as final to provide the
Department clear authority to enforce tobacco inspections and collect
fines from retailers who sell tobacco to our minors. It continues to be a
vital building block in the efforts to keep Idaho minors safe and drug-free.

A brief discussion was held about the number of penalties and fines; the
federal block grant; enforcement efforts to prevent young women and
young men, under age 25-years, from using tobacco products; the
removal of cigarette vending machines, working with Idaho’s Indian Tribes
and law enforcement authorities, and changing the word “shall” to “must.”

27-0101-0205

Docket 27-0101-0205, relates to controlled substance prescription forms
authorized by House Bill 331.

This rulemaking recognizes revised controlled substance prescription
forms authorized by House Bill No. 331 in the 2001 legislative session, as
well as Senate Bill No.1417 in the 2002 legislative session. The proposed
rule changes outline the requirements for controlled substance
prescription blank forms, as well as discipline to be assessed by the
Board of Pharmacy in the event practitioners fail to follow the
requirements of statute and rule with respect to controlled substance
prescription blanks.

Robert Seehausen, Chief Executive Officer of the Idaho Medical
Association (IMA), testified he has no problems with the rules.

Dr. James Scheel, from the IMA reported he has no objection to the
rules.

27-0101-0302

The current rule treats “preparations containing ephedrine or salts
ephedrine” as prescription drugs. The proposed rule sets out specific
criteria for ephedrine products that can be sold without prescription.
These criteria include maximum dosage requirements and label
disclosure and warnings.

Fee Summary: Pursuant to Section 67-5226(2), Idaho Code, the
Governor has found that the fee or charge being imposed is justified and
necessary to avoid immediate danger. An immediate danger is inherent in
ephedrine products if they are sold in dosage amounts in excess of the
rule or containing synthetic rather naturally occurring ephedrine alkaloids.
The fee charge under this rule is necessary to fund testing of these
products to ensure compliance with the requirements of the rule.

Mr. Markusen asked that this rule be made final.

27-0101-0303

This rule change allows return and use of unopened and unused drugs.
This change responds to House Concurrent Resolution (HCR) No.17
directing the Board of Pharmacy and the Department of Health and
Welfare to develop necessary statutory and rul changes to allow the
return and use of unopened and unused drugs.

Section 156.02 – Defines the annual report of the registered pharmacist-manager.

Section 156.03 – Defines the responsible pharmacist manager.

Section 156.04 – Defines the responsibility of the pharmacist manager.

Section 156.05 – Defines the return of drugs or other items. In the interest
of public health, drugs, medicines, sickroom supplies, devices and items
of personal hygiene shall not be accepted for return by any pharmacist or
pharmacy after such drugs, medicines, sickroom supplies, devices and
items of personal hygiene have been taken from the premises where sold,
distributed or dispensed, except that unopened “Unit Dose” packaged
medications for in-patient of residential or assisted living facilities,
licensed skilled nursing care facilities, and hospitals may be returned to
the dispensing pharmacy for credit provided the medications are liquid
medication that have been supplied in manufacturer sealed containers
and remain unopened, or the medications are in unopened “Unit Dose”
packaging. In addition, the following conditions set forth in Subsection
156.05b.

HCR No.17 was passed during the 2003 legislative session, and this rule
does comply with HCR17.

A discussion was held regarding these rules of the Board of Pharmacy
and a possible conflict with the rules of the Department of Health and
Welfare’s Medicaid rules work together, long-term care facilities, the
safety of drugs, and a pharmacist’s option to refuse to accept the returned
drugs.

27-0101-0304

This rule change expands the list of acceptable pharmacy references
which are part of the required library in each pharmacy. This change is
necessary to implement an expanded list of acceptable pharmacy
references now recognized by the Board of Pharmacy.

Section 152.01 – Required Books – The latest edition and supplement(s)
of the following: Idaho Pharmacy Law and Rules; A current pharmacy
patient counseling reference; Facts and Comparisons; one (1) of the
following current pharmacy references – Facts and Comparisons, Clinical
Pharmacology, Micromedex: and one (1) other current pharmacy
reference of your choice (book or computer diskette).

19-0101-0301

The Board of Dentistry’s pending administrative rules are intended to
accomplish the following matters:

• To incorporate the American Dental Association’s Principles of
  Ethics, Code of Professional Conduct and Advisory Opinions
  (“Principles of Ethics”) by reference into the Idaho Board of
  Dentistry’s professional standards. A copy of the ADA’s Principles
  of Ethics is included in these materials. The ADA’s Principles of
  Ethics address such areas of dental practice as patient
  self-determination, patient confidentiality, standards of care and
  dentist veracity. The ADA’s Principles of Ethics are currently
  applicable to all Idaho dentists who are members of the Idaho
  State Dental Association or the American Dental Association. A
  violation of the Idaho Board of Dentistry’s professional standards
  can result in disciplinary action against a dental licensee. See
  Attachment #1)





• To specify those dental specialties which are recognized and
  licensed by the Idaho Board of Dentistry. The Idaho Board of
  Dentistry currently licenses six (6) dental specialties and the Board
  members determined that those specialties should be expressly
  identified in the administrative rules.





• To define advertising terms and delineate what conduct
  constitutes false, misleading or deceptive advertising. At present,
  the Idaho Dental Practice Act [Idaho Code § 54-924(4) and (9)]
  specifies that false, fraudulent, misleading and deceptive
  advertising is proscribed and may provide grounds for disciplinary
  action against a licensee. Enforcement of the advertising
  provisions in the Idaho Dental Practice Act requires the Idaho
  Board of Dentistry to specify those matters that constitute
  impermissible advertising conduct.

Jerry Davis, Director of the Idaho Dental Association, reported the vast
majority of dentist support the rules.

15-0120-0301

The proposed rule changes eliminate many existing requirements
regarding the day-to-day operation of Area Agencies on Aging (AAAs).
This will allow more flexibility in the AAA’s provision of services to the
elderly through implementation of consumer choice programs. These
AAAs are not state agencies but are subject to federal laws and rules.

EXCUSED:

Steve Allred, Director of Idaho Department of Environmental Quality,
gave the introduction of Suzanne Budge Schaefer to the Committee
members. He stated the Review Panel consists of ten members: three
representatives from state agencies, four from the community, and three
selected by the Governor. Suzanne has an undergraduate and Master of
Science degree in Geology. Her experience includes working on the US
geological survey. She has spent time in Houston and Oklahoma on an oil
patch. And she worked briefly at INEEL. She has been in Boise for 15
years and has been working mainly on regulatory environmental issues.

Senator Stegner addressed Suzanne asking if her other positions would
conflict with this appointment. Suzanne did not believe there ever would
be, however, if a case should come up she would be sure to disclose that
information to the Governor, and would be replaced at his wish.

Senator Darrington gave a history of the Hazardous Waste Management
Act, and the creation of the Hazardous Waste Advisory Panel. The
Hazardous Waste Plan says the State of Idaho will not be more stringent
than the Environmental Protection Agency (EPA) in regard to RICRA, and
the RICRA amendments.

The Committee will vote on the Gubernatorial Appointment of
Suzanne Budge Schaefer at tomorrow’s meeting.

Senator Compton commented on the value and institutional memory of
senior Senators who provide valuable insight to those in the Legislature,
especially freshman Senators. He stated that Senators Darrington and
Ingram have such extensive knowledge and experience, they are an
example of why term limits are not a good idea.

Orville Green, Administrator, Waste Management Remediation, DEQ,
referenced DEQ Annual Report 2003, on page 5, a discussion of the
Underground Storage Tank program summary: federal rules that
owners/operators must abide by, and the leaking underground storage
tank program. Since 2000 DEQ has seen the completion of 226 leaking
underground storage tanks, however, during the same time frame, 105
new leaking tank sites were identified.

Chairman Brandt asked how many tanks out of the 105 are still in use?
Mr. Green stated 197 leaking UST were on record through July 2003. Mr.
Green stated that 226 tanks have been cleaned up since 2000. DEQ
maintains a running tabulation of active/non-active sites.

Chairman Brandt stated that a rule addressing primacy and new
regulations for existing tanks was rejected by the Senate Resources and
Environment Committee last year. He asked whether the new leaking
tanks were a result of not having adequate regulations. The rule last year
would’ve required an extra piece of equipment put on the tanks. Would
these 105 tanks been required to have this piece of equipment? Mr.
Green stated these tanks would have required this equipment, under the
federal rules, several tanks were cited for not having this equipment. 17%
of the facilities inspected were cited for this reason. The purpose for the
UST rules is preventative, not responsive.

Last fall EPA, Environmental Protection Agency, enacted an aggressive
inspection of UST in Idaho. Erik Sirs, Project Grants Officer for UST
and LUST Programs, Enforcement Compliance Officer, EPA informed
the Committee of the results of the inspections. He gave background of
the UST program in Idaho, results of Idaho Initiative, and Significant
Operations Compliance, a national measure that states how Idaho is
doing.

The UST program has two components. The first component is
prevention, compliance and enforcement which is federally run. The
second is LUST which is state run.

The Idaho Initiative was developed due to previous years field experience
indicated there was a low compliance rate occurring in the state. It is EPA
responsibility to administer the compliance program within Idaho. Mr. Sirs
brought in other EPA inspectors from around the region to assist in the
project.

Chairman Brandt asked Mr. Sirs how many inspectors there were to
perform the inspections as he told the Senate Resources and
Environment Committee last year. Mr. Sirs stated that Idaho has one
federal inspector and two for the Region.

Mr. Sirs stated the regional area selected for the project included: Idaho
Falls, Pocatello, Couer d’Alene, and Boise due to large population centers
and gave a large snapshot of the state. He tried to choose sites that had
not been inspected before. Letters were sent out two weeks in advance
indicating what information the inspector wanted to see when they came
on the site. 94 inspections were performed. 20 facilities passed, 33
written warnings were issued (may have involved field citations) and 47
field citations with monetary penalties resulted. A total of 146 violations
were recorded for the 94 inspection sites.

Mr. Sirs referenced a graph depicting Enforcement Results in various
categories of pie charts.

Violations

• Insurance Related 8.4%
• Upgrade Violations 27.4%
• Corrosion Protection 13.7%
• Release Detection 49.5%
• Temporarily Out of Service 1.1%

Chairman Brandt recollected that nowhere in a written rule is it required,
even federally, that sensors be included, it is strictly interpretation. Mr.
Sirs stated the rules require two things for line leak protection: monitoring
for catastrophic (3 gallons/hr.), and/or annual tightness test, monthly
monitoring (electronic sensor), visual inspection (logging number in a
chart). Chairman Brandt restated that if a facility had other equipment
installed, monitored it properly, they wouldn’t need the sensor. Mr. Sirs
stated this was correct.

Mr. Sirs stated UST compliance is an issue of significant importance,
ground water resources are the primary source of drinking water and EPA
is the agency currently responsible for UST compliance. EPA has
requested additional resources to conduct other inspections to see if the
trend holds true. On the national level, the Energy bill is still in question,
and the enforcement section could assist the state with resources.

Senator Compton asked for clarification on 3400 tanks available for
review in the state. He asked if the 94 inspected were primarily service
stations. Mr. Sirs stated they were. Senator Compton asked how he came
up with selecting this two-percent sampling. Mr. Sirs stated it was at
random, based on area, he looked for a large amount of facilities within a
large area for the purpose of ease of use in conducting the quantity of
inspections.

Chairman Brandt asked Mr. Sirs if he found a visibly leaking UST during
his inspections. Mr. Sirs reported not one leaking tank was found.

Chairman Brandt referenced an Idaho Statesman article entitled “EPA
inspectors find evidence of leaking fuel tanks in Idaho“, which gave
numbers that didn’t coincide with the chart before the Committee at
present. Mr. Sirs stated the numbers in the article differ slightly because
of some last minute data that was entered into the current chart.

Senator Bailey asked for clarification on the citations issued during the
inspections. Mr. Sirs stated that the citations issued were for violations of
regulations not for contaminating the water.

Senator Darrington stated that the UST are just one type of problem that
could spoil the water quality. He also asked whether there has been any
study on the correlation between those violations and underground leaks.

He stated the important thing is that the Committee is assured and the
industry is assured that the things checked have validity and make a
difference to the whole program.

Discussion among the Committee members included: the fact that Idaho
has no program; the facilities haven’t been inspected before; the results
are alarming, and is there any chance that those inspected didn’t have the
adequate records on hand; and what the state of Idaho needs to do to
prevent ground water contamination from UST.

Senator Bailey asked what is entailed in the clean up of a site. Mr. Allred
stated that the tank is ceased use, repaired or removed; contaminated
soil around the tank is removed, but the most costly is what is in the
ground water and removing it. $2.6 million was spent cleaning up these
sites, some of the money was state funds. He stated the problem is with
the lack of personal responsibility and accountability. He reiterated there
is a need for a program to make people personally accountable.

Chairman Brandt stated there is a need to protect the water. He is
frustrated with regulations that change all the time, what is good today
isn’t necessarily good tomorrow. He thanked the EPA for validating the
direction last year when the inspection question was brought to the
Senate Resources and Environment Committee. However, when the rule
was before the Committee they were told there was one inspector, yet
there were twelve inspectors, plus the administrative staff to handle the
inspections. He stated the Idaho Statesman article made it sound like
Idaho had fourteen leaking tanks, when in fact there were no leaking fuel
tanks found at all.

Senator Kennedy stated that he didn’t want the EPA or DEQ to think that
this legislative body does not feel it should accept the responsibility to do
a fair share in prevention responsibilities of protecting the ground water.
He stated it was necessary to revisit the matter, to see if there are
reasonable regulations to allow our state to join the other states to
adequately protect the ground water.

Suzanne Budge Schaefer, Idaho Petroleum Marketers and
Convenience Store Organization, introduced Bob Franklin, Charlie
Jones, and Dennis Baird (see sign in sheet). Suzanne distributed
handouts to the Committee: “Idaho UST Enforcement Initiative, October
27-30, 2003, EPA Region 10, Submitted by Idaho Operations Office
December 3, 2003” and “Overview of Underground Storage Tank
Regulation in Idaho” and an EPA Memo (see attached). She stated that
Idaho has been a success story with an 85% clean up rate, there are
declining claims, and declining leaking sites. She stated that Idaho has
3548 active tanks, 9157 closed tanks which is 61% closure rate. She
reported approximately 3000 tanks are insured. She said there is a case
to be made that the federal regulations have been very effective in the
state of Idaho, regardless of whether there is a state program. Currently
they must comply with the federal rules, to get insurance, if they don’t
have insurance they do not operate. She stated that the rules haven’t
changed but the interpretation of the rule has changed which is what
causes the frustration.

Senator Bailey stated that he would like to see meetings offered in North
Idaho. Senator Ingram asked who conducts the tests and who collects the
fees. Toni stated legislation is proposed to transfer the responsibility over
to the Bureau of Occupational licensing.

Senator Darrington stated that as these changes take place, it is
important to make sure these rules are maintained under the Health and
Welfare Committee.

EXCUSED:

Reappointment:

Suzanne Budge Schaefer of Boise, was reappointed by Governor Dirk
Kempthorne for a term commencing March 6, 2003 and expiring March 6,
2006. She is the manager of SBS Associates, LLC, in Boise.

Her educational background includes a Master of Science in Geology
from Colorado, and a Bachelor of Science in Geology from Logan, Utah.

Mrs. Schaefer’s previous work experiences include: The Galltin Group in
Boise; Corporate Relations Vice President of AIA Universe Insurance
Group in Boise; Executive Director of the Idaho Council on Industry and
the Environment, Boise; Scientist, Geosciences Group, Idaho Falls;
Geologist for Conoco, Inc. in Houston, Texas; Geological Intern for Sohio
Petroleum in Denver, Colorado; Graduate Teaching Assistant for
Colorado School of Mines in Golden, Colorado; Geological Field and
Laboratory Assistant for the U.S. Geological Survey, Denver, Colorado;
and, Consultant for the Colorado School of Mines Core Lab in Golden,
Colorado. Her political affiliation is Republican.

Over the past several years, the Legislature has enacted a number of cost
reduction initiatives intended to curb Medicaid costs. Attached is a list of
some of the more recent examples. Despite these initiatives, anticipated
savings have not been realized, and expenditures continue to rise,
surpassing appropriations in fiscal years 2001, 2003 and 2004.

One weakness in the Medicaid program that has hindered the budgeting
process is that the agency has not routinely provided the Legislature with
information on the extent to which it has achieved the cost savings
anticipated by cost reductions. Such reporting is necessary to keep the
Legislature informed of the impact of its policy decisions and to assist the
Joint Finance -Appropriations Committee in identifying budget needs.
JFAC will be directing the Department of Health and Welfare this year to
respond to those questions this year.

Another challenge to cost containment efforts by the Legislature are the
sometimes inconsistent intentions which develop between three
committees JFAC and the House and Senate germane committees. In
some instances, there is not a consensus to support the necessary
changes in rules and regulations that are required to implement cost
reduction measures that were intended in the appropriation bill from the
previous year, which essentially takes the department off the hook, or at a
minimum places the Department of Health and Welfare in an awkward
position.

We need your help this year in focusing on clear cost containment goals
in the budget process. For the past twenty years the average increase in
the General Fund Medicaid budget has been nearly 14%. We are no
different than other states in seeing a disproportionate amount of our
resources chasing significant caseload and health care cost increases
year in and year out. We also know the choices are difficult.

As you know we set aside time at the close of the budget hearing process
for the germane committee chairs to address JFAC. We would like to
enlist the help of your committees in examining what cost control policies
would be most appropriate for reigning in the spiraling costs of Medicaid.
Specifically, we would appreciate an actual committee vote on potential
cost control measures, then have you present those results during your
JFAC presentation the second week of February. Some of the issues
could include, among others:

1. Reducing or freezing provider rates

2. Reducing or restricting eligibility

3. Reducing or eliminating certain Medicaid benefits

4. Implementing a co-payment system

5. Identifying long-term care reduction strategies

6. Continue efforts to shift other relevant state programs to Medicaid

7. Implement some form of provider fees.

As always, we look forward to working closely with you in the coming
session. Your input is crucial for finding common ground on how best to
stabilize a program that continues to increase in funding requirements
beyond our means.

Committee members reviewed and discussed the JFAC memorandum
and the chart “Medical Assistance Program, Anticipated Savings from
Medicaid Cost Reduction Initiatives.” (See Attachment #1).

The committee suggested the chairman contact the Department of Health
and Welfare and discuss the seven (7) items listed in the JFAC
memorandum. What programs in Medicaid have federal mandates and
cannot be changed, and does the Department believe the seven items are
obtainable?

EXCUSED:

He explained, as in the past the Department has five appropriations. This
year’s request is a very plain and straightforward request. Simply put, it is
maintenance of the current operations budget.

The Department’s overall 2004 appropriation was $1.292 billion; this
year’s request is $1.453 billion or a 12.4% increase.

The 2004 appropriation required general funds of$375.8 million, while the
2005 request is $415.7 million, or a 10.6% increase.

The increases are primarily made up of Personnel Cost Rollups or benefit
increases, medical inflation, increased Medicaid caseloads and the 2%
change in employee compensation or CEC. We also have two new
expansion decision units, as well as, the annualization of startup costs for
the CHIP B and CHIP Access card programs.

The Division of Family and Community Services (FACS) has the most

changes. This year, we are transferring the Sheltered Workshops from

FACS to the Division of Vocational Rehabilitation. This transfer moves

almost $3.8 million from the FACS budget and out of the Department.

Within FACS, we also have two new expansion decision units. These

decision units are for funding in the Infant & Toddler program and the
foster care program. The Infant & Toddler program provides early
intervention services for children up to three years of age who have
developmental disabilities. This funding will bring the department into
federal compliance for meeting our timeliness in providing service access.
The second decision unit, for foster care, is requesting a 5 percent (5%)
increase in the amount paid to foster care parents. Currently, for a 10-year-old child, we pay $286 per month compared to an average of Idaho’s
neighboring states of$413, or 44% less. This increase will move the
amount to $300 per month and will still keep us 37% less than our
neighboring states. The general fund costs of these programs are
$220,000 for the Infant & Toddler program and $161,500 for the foster
care program.

Within the FACS appropriation, we also have an increase in employee

compensation of $1.1 million, and an increase in employee benefits cost
of $1.4 million.

The general fund impact for this appropriation is a $1.1 million reduction.

Again, this is due to the transfer of the Sheltered Workshops to the
Division of Vocational Rehabilitation.

The appropriations for Indirect Services, Welfare and Health have no

material increases outside of the change in employee compensation
totaling $573,300. Personnel cost rollups of $763,000 and the
annualization of the CHIP program in the Division of Welfare for
$421,200. The overall increases for these three divisions total $1.5 million
in general funds.

The final appropriation is Medicaid. Medicaid has an increase of$39.4

million in general funds.

Most of the increase is caused by three simple facts. The first being, more
people will be enrolled in Medicaid next year, . . . which leads into the
second, meaning we will pay for more services, and . . . the third, the cost
for many services are also increasing.

More people . . . More services . . . and providers charging more for
those services. That accounts for $35.3 million or 90% of the general fund
increase in our Medicaid request.

The remaining $4.1 million is related indirectly to the CHIP expansion

approved by the Legislature last year .The cost for services in the new
CHIP B and CHIP Access Card programs will be covered by a
combination of funds from the state’s premium tax fund and the federal
government.

However, we anticipate that interest in the new CHIP programs will also

drive up enrollment in the current CHIP program and Medicaid’s Pregnant
Women and Children program. This is often referred to as the woodwork
effect. The state share of increased costs for these two programs would
be $3.4 million – which will come from the General Fund.

Finally, Medicaid has $130,000 for annualization of Chip program

supplemental request and $230,000 for the combined CEC and Personnel
cost rollup.

Again, as a high level recap: the 2005 budget . . . is maintenance of
current operations budget with an overall increase of$39.8 million in
general funds primarily found in six (6) items that increase costs and one
that reduces cost.

The additions are:

• $35.3 million for the “normal,” annual increased cost of doing
  business in Medicaid;





• $550,000 for the annualization of Chip B & Access Card
  supplemental;





• $3.4 million for woodwork effect associated with the new Chip B &
  Access Card programs;





• $2.3 million for personnel cost rollups or increases in benefit costs;





• $1.8 million for CEC or Change in employee compensation; and,
  $381,500 for the two new expansion decision units I mentioned;





• Those increases are reduced by $3.8 million and the transfer of
  the Sheltered Workshop program and funding out of the
  Department to the Division of Vocational Rehabilitation.

The committee discussed “required vs. optional” Medicaid Services. In
FY1993, expenditures for federally required services amounted to 75% of
the overall Medicaid budget with the cost of optional services 25% of the
total. The FY 1993 total was $300.3 million.

In FY2003, expenditures for federally required services dropped to 44% of
the overall Medicaid budget with optional services expanding to 56%. The
FY 2003 total was $869.6 million.

Required Services – Idaho must ensure that Medicaid clients receive the
health care services required by federal guidelines. These mandatory
services include physician visits, family planning, laboratory tests, health
screening services for individuals under age 21, hospital inpatient and
outpatient services, and prescription drugs for children and pregnant
women.

Optional Services – Idaho also provides a number of optional services,
such as prescription drugs for adults; expanded personal care services;
full coverage of prosthetic devices for adults; dental, eye, and hearing
services for adults; heart, liver and other organ transplants for adults;
payment for services at long-term care facilities for the mentally retarded;
adoption and expansion of a children’s health insurance program;
services for developmentally disabled adults; mental health services for
adults; chiropractic and podiatry services; physical therapy; enhanced
pregnancy services; and services from ambulatory surgical centers.

The committee reviewed a chart about the Department’s 2005
appropriations: (See Attachment #1)

• Medicaid – 73.8%
• FACS – 10.1%
• Welfare – 8.4%
• Public Health – 4.7%
• Indirect Support – 2.7%
• Councils – 0.3%

A Medical Assistance Program, expenditure by service category, listing of
what services are required (federal mandated/state services), and the
actual and estimated percentages were also reviewed. (See Attachment
#2)

It’s important for people to know that the Department’s investment
benefits all Idaho residents. This is wise use of taxpayer dollars because
the money spent in the community often stays in the community. Those
dollars are spent again and again to help create jobs and create an
infrastructure that provides healthy and safe communities.

A discussion was held pertaining to complaints Health and Welfare had
received during the last year, such as:

• The number of complaints the Department had received from
  small providers about late or timely payments during the last year?

Mr. Butler stated, “we receive complaints on a periodic basis.” He
informed the committee that Senator Ingram brought one group of
providers before us, pressing us about late payments. We did our
research and found out that, on average, we paid that group every 22-days. Their claim was the payments were at 40-days. Mr. Butler reported,
“yes,” we are late on some payments, but any billion dollar industry will
have a lag-time, but for the most part we are timely. The average payment
rate is 22-days, some later and some shorter, but overall payments are
made within 22-days.

• If a payment is late, does Health and Welfare pay interest on the
  late payment? Is there a statute in Idaho Code governing the
  Department paying interest on late payments?

Mr. Butler reported there is no obligation for the Department to pay
interest unless it is stated in the contract.

• Senator Bailey referred Mr. Butler to Idaho Statutes, Title 67,
  State Government and State Affairs, Chapter 57, Department of
  Administration, 67-5735 – Processing ­ Reimbursement of
  Contractor: “Within ten (10) days after the property acquired is
  delivered as called for by the bid specifications, the acquiring
  agency shall complete all processing required of that agency to
  permit the contractor to be reimbursed according to the terms of
  the bid. Within ten (10) days of receipt of the documents
  necessary to permit reimbursement of the contractor according to
  the terms of the contract, the state controller shall cause a warrant
  to be issued in favor of the contractor and delivered. Contracts let
  or entered into by or through the division of purchasing are exempt
  from the provisions of Section 67-2302, Idaho Code; provided,
  however, that late contract payments may be assessed interest by
  the vendor at the rate set forth in Section 63-3045, Idaho Code,
  unless another rate is established by contract.”





• Section 67-2302(3), Idaho Code, State Government and State
  Affairs, Chapter 23, Miscellaneous Provisions: “Unless specifically
  provided by the terms of a contract that details payment
  requirements, including penalties shall be due automatically when
  bills become overdue. It shall be up to each vendor to calculate
  and invoice interest at the time payment is due on the principal.”





• Section 67-2302(17), Idaho Code, “Each state department,
  institution and agency head shall be responsible for prompt
  payments. In all instances where an interest payment has been
  made by a state agency because of a late payment, the
  responsible state agency head shall submit to the joint senate
  finance-house appropriations committee of the legislature at the
  time of that agency’s budget request hearing an explanation of
  why the bill is paid late and what is being done to solve the late
  payment problem.”

Kelly Buckland, Director of the Idaho Independent Living Council,
explained that in 1996 Governor Batt started the Medicaid Reform
Council, and they made recommendations about changes to Medicaid.
The Medicaid BUY-IN program for Idahoans with disabilities was
recommended by the Council. The Medicaid BUY-In is a program that
helps people to work by permitting them to buy into Medicaid while
working. For people currently on Medicaid, there is no incentive to work
more than part-time because if they earn even one dollar too much, they
will lose their Medicaid coverage. That coverage pays for the supports
and services that people with disabilities need to go to work. With
Medicaid BUY-IN, when the eligible person goes to work, they pay a
premium, based on a sliding scale, which enables them to retain their
coverage. The program encourages independence instead of trapping
people in dependence and poverty.

Mr. Buckland requested the committee, when they meet with JFAC (Joint
Finance Appropriations Committee), to support the Governor’s request in
his State-of-the-State address, “many Medicaid recipients are penalized if
they have a job.” I say we remove of the penalty, and to enable Medicaid
recipients to work without losing health care benefits and services that
help them remain independent. I urge your support of this common sense
change.”

Joyce McRoberts, Deputy Director for the Department of Health and
Welfare, informed the committee members that today the Department
started the “Any Door Initiative” project in Moscow, Region II.

EXCUSED:

16-0309-0311

She explained. Two weeks ago I presented this rule docket 16-0309-0311 regarding Medicaid’s Mental Health rules.

When I first presented this rule docket, you heard testimonies from the
Mental Health Provider’s Association. You also heard that Medicaid was
responding to some of these concerns through rule amendments that we
had begun to draft. Additionally, Representative McGeachin testified
about her concerns regarding the appropriate role for paraprofessional.

Your committee requested that ­ because of the issues expressed ­ that
Medicaid staff and the providers who testified sit down and sort through
these issues.

I’d like to briefly review with you, the twofold purpose of these rules:

• There was a need to reflect changes in provider and department
  responsibilities as a result of staff reductions in the Regional
  Mental Health Authority; and

• There was a need to clarify service expectations and provide
  service definitions in response to health & safety concerns,
  particularly for services provided in Partial Care settings.

The rule changes relate to two distinct mental health benefits: 1) Psycho-Social Rehabilitation (PSR) and 2) Mental Health Clinic services.

The first part of the docket identifies changes to the Pycho-Social
Rehabilitation (known as PSR rules), reflecting the reduction in Regional
Mental Health staffing and the resulting changes in the roles and
responsibilities of private PSR providers. The functions of assessment
and service planning have been transferred to the private PSR providers.

Additionally, these rules incorporate service definitions, clarify provider
qualifications, and spell out service expectations. Significant
clarifications include the requirements that:

• PSR Provider Agency personnel coming into direct contact with
  participants must comply with existing statutes governing criminal
  history check requirements; and,





• PSR agencies provide 24-hour crisis response services for their
  participants or make contractual arrangements for the provision
  of those services.

The changes to the mental health clinic rules and related partial
care rules were made primarily due to safety issues. Over the past
year, the Department was alerted to situations where individuals
appeared to be at risk when receiving care under this benefit.

As I mentioned in my previous presentation, prior to these rules, “partial
care” ­ a Mental Health Clinic Service ­ could be applied to a number of
programs. Some ­ included what might be considered babysitting, others
included a lot of television watching, and some including boot camp type
services. And because service expectations were not clearly articulated,
many of the safety issues found over the past years have arisen in this
setting.

This rule docket does not introduce any new federal or state
requirements for clinic except for the inclusion of building standards,
which were added as a direct result of documented cases of child
endangerment due to substandard buildings that were being used as
clinics. These temporary rules contain federal and state guidelines that
have been in effect for many years. All changes are intended to result in
a greater understanding in the provider community of the scope of
mental health services as they are required to be.

These temporary rules, effective December 1st were published in the
November Administrative Bulletin. Three public hearings were conducted
and public comments were accepted through November 26, 2003.

Last week, Department representatives met with representatives from
the Mental Health Provider Association to discuss how to address
concerns with the rules and related service issues. Our meeting was very
productive. We found a great deal of agreement regarding the need to
have our rules reflect the best possible outcomes for individuals
receiving mental health services. We also agreed to commit to monthly
meetings to jointly draft amendments to the temporary rules that are
before you in order to address some inconsistencies and make changes.

The outcome of this meeting was an agreement to ask Legislators to
extend these temporary rules with the understanding that the
Department will work with stakeholders to amend these rules.

The Department is committed to continued negotiations with
stakeholders in order to produce rules that reflect best practices with the
primary goal of meeting the needs of individuals with mental illness with
the best outcomes. The resulting rules will be in compliance with
applicable state and federal laws, protect the health and safety of the
recipients, are cost effective, and recognize resource limitations.

A work group is scheduled to meet on February 5, to begin reviewing
amendments. Members of the work group include representatives from
the Family and Community Services Division, Medicaid, Mental Health
Providers Association, Fraud & SURS, Consumers and Advocates. The
group will meet at least monthly until rule amendments accurately reflect
the desired outcomes. The amendments will be published and hearings
will be conducted. The amendments will not go into effect until they have
received public review and providers have had time to make necessary
changes in their business practices.

The Department presented this rule docket to the House Health &
Welfare committee last week. At that meeting, the Department and
representatives from the Mental Health Provider Association asked the
committee to extend the rules. However, the House Committee decided
to hold its decision until after the meeting on the 5th in order to see what
progress is made. Two members of the committee (Representative
Garrett and Representative Henbest) asked to join the work group. A
mental health provider who represents Representative McGeachin’s
concerns will also join the work group.

Although we know that improvements can be made to this temporary rule
docket, and we are committed to making those changes, we still believe
that it is in the best interest of the individuals receiving these services for
this committee to extend the temporary rules. Without these rules, we will
lose ground on our ability to ensure safe care. Some services will
continue to be provided by unqualified staff, and some qualified staff will
be unable to provide services. I’d be glad to share additional impacts if
this committee would like further information.

This concludes my presentation on Docket 16-0309-0311. The
Department requests that the committee extends these temporary rules
with the Department’s assurance that it will continue to work with
stakeholders on amendments that will address areas of concern.

I will be glad to answer any questions that the committee might have
regarding this docket.

Written comments received by to the Senate Health and Welfare
Committee to be included the minutes are:

My name is April Crandall and I am President of the Mental Health
Provider’s Association. Representatives from our association have met
with Department of Health and Welfare staff regarding the PSR and
Clinic rules for community mental health services Docket 16-0309-0311.

We met with the Department on January 22, and I would like to
compliment the Department on the willingness to meet and to commit to
continued meetings and negotiation.

• We agreed that there was much work to do together to mold
  community mental health services that are quality services for
  those with mental illness and services that are a good value for
  taxpayer dollars. We discussed our concerns with Partial Care
  (Day Treatment Definition), Physician Requirement, and
  unfunded mandates. We agreed to discuss these further.





• We agreed to ask the Health and Welfare Committees to extend
  these Temporary and Proposed rules with the commitment to
  work on amendments together.





• We agreed to schedule monthly meetings with other stakeholders
  at the table to produce amendments that reflect quality services
  that are reasonable in compliance with federal and state laws and
  that is within the capability of the private providers.





• We agreed to published rules with scheduled hearing and have
  effective dates that would give time to include changes as
  discussed with the stakeholders. The Department agreed to do a
  reimbursement analysis to possibly include a reimbursement
  increase in the July budget set for next year.





• We agreed to look at the future possibility of accreditation
  standards, using resources up front to ensure quality services
  and to poor quality or misuse of taxpayer dollars. We are going to
  look at better communication strategics and to decide when
  enforcement begins on the disputed areas in the temporary and
  proposed rules. The decision was that disputed areas would not
  be enforced until they were resolved.





• We ask you, as the Health and Welfare Committee, to extend the
  temporary and proposed rules with the idea of amendment
  negotiation.

I’m available for questions on community mental health services,
differences between mentally ill individuals and mentally handicapped
(developmentally delayed) individuals. Thank you.

16-0309-0308

for the Department of Health and Welfare, presented these pending
rules, Docket 16-0309-0308, for adoption as final rules.

These rules govern the Department’s activities relating to investigation of
Medicaid fraud and abuse and have been amended to help the
Department protect the program funds and clients from fraud and abuse.

These rules have been amended to cleanup language due to federal rule
changes and restructure the rules and make them clearer. In the
changes we have clarified the department’s ability to access and copy
records of services provided to Medicaid clients.

Changes have been made to clarify the Department’s ability to deny

payments or exclude providers for failing to provide access to records.
This language is consistent with federal regulations and is clarifying
existing authority.

Changes have been made to clarify and standardize the appeal process
for department actions. The Department is attempting to consolidate
rules, and appeals are defined by the Rules Governing Contested Case
Proceedings.

Clarifications have been made on the Department’s actions to mirror the
federal regulations when suspending payments to providers for fraud.
This is not adding authority, but holding the department more
accountable in these types of actions.

We did not receive any public comment or opposition to the pending
rules.

I presented these rules to this committee last week and heard opposition
or testimony from two groups. One did not oppose the rules, however,
opposed the organizational structure of the fraud unit.

I have met with the second group, the Mental Health Providers
Association. They represent a group of providers who are trying to
provide needed services. They understand rules to address fraud and
abuse within our vulnerable program are necessary to stop those
providers who will drain program resources, and cast distrust on their
profession and the services they perform. Their concerns were relating to
the repeal of Section 204 which discussed the referrals to a Surveillance
and Utilization Review Committee, and the repeal of Section 210 which
provided for a hearing within 30-days for an immediate action when
suspending payments or a provider agreement. The committee
described in Section 204 is no longer in existence, and I have committed
to the association to further define the process for decision making when
suspending payments to providers. With this commitment, the Mental
Health Providers Association has agreed to support these rules to allow
the Department to stop unnecessary waste and abuse, provided Section
210 is restored.

The Department does not oppose restoring this section.

Mr. Chairman and members of the committee, when I presented these

amendments to you last week, I also heard discussion of due process,

concerns with suspending providers, HIPAA violations with access to

records, and nonspecific discussion regarding the department being
“heavy handed” or retaliatory with providers. This greatly surprises and
concerns me, and I would like to discuss with you the business of fraud
investigations to hopefully address any concerns you may have.

First, due process is fundamental in our appeal processes. Our appeal
rules provide due process, and appeals are heard by an independent
contract hearing officer. Our independent hearing officer is required by
contract to set a hearing date within 30-days of an appeal. To address
the concerns of the association, I am recommending we restore Section
210 to ensure a hearing within 30-days. The Department will also look at
amendments to the contested case rules, and I will commit to involving
the association with those revisions.

I also serve as the Bureau Chief over the HIPAA (Health Insurance
Portability and Accountability Act) Privacy Office for the department. The
Department’s ability to access records for the purpose of fraud
investigations is in no way a violation of HIPAA regulations. HIPAA
provides authority to access these records for the purpose of treatment,
payment, and operations.

I also heard concerns about suspending provider payments and my staff
being “heavy handed” with providers. I have seven (7) staff responsible
for investigating fraud within a program which in one week, processes
over 150,000 claims and pays out over 17 million dollars. In only one
week!

Over 85% of these claims are received and paid electronically, which
ensures fast payment and little or no human oversight or intervention.
With over 15,000 providers to watch over, if a single provider wanted to
submit fraudulent claims it would not be difficult to submit them
electronically and fraudulently obtain a large volume of money. This was
the case in the newspaper article on Sunday and provided in your
handouts, where a social worker was able to steal more than $150,000
billing for clients she never saw. This type of example is not often
encountered and is considered the “exception.”

I am sorry to bring this news to you, but we do have white collar criminals
within our vulnerable program. These are thieves masquerading as
health care providers. They are, however, the exception to the 15,000
providers in the program. Unfortunately, they often turn out to be our
trusted health care practitioner, members of your community, your
constituents, or even members of your church. Not so long ago, one of
these exceptions had been given the title by her community of the
“Business Woman of the Year,” and later was sentenced to over two
years in prison for stealing from our program.

Many of the provisions in these fraud rules are written for these providers
who are the “exception,” and they are vital for us in order to protect
program dollars and clients.

The Department has always had the ability to suspend provider
payments. The revisions in front of you actually tighten this ability and
raise the burden from merely “suspecting fraud and abuse” to now we
must show “reliable evidence” of fraud and abuse. It also clarifies the
notice requirements and how long a suspension may last which was not
previously defined.

If you will refer to the chart, Provider Investigations, which I have
provided to you, it shows the results of fraud cases opened in the last
three years. (See Attachment #1).

There have been 659 fraud cases opened in the last three years. Of
those cases,

• 199 cases or 30%, were closed and we were able to unfound the
  allegations made against a provider.





• 53 cases or 8%, resulted in provider education or clarification of
  processes.





• 223 cases or 33%, resulted in a recoupment action. Keep in mind
  often a case is not opened unless there is some likelihood a
  problem or overpayment exists. These cases recouped over 2.7
  million dollars.





• Even with less restrictive payment suspension requirements, only
  four (4) of 659 cases resulted in a payment suspension action.
  This is a little over ½ of 1%. In those cases, three of them have
  already been prosecuted for healthcare fraud in federal court and
  the fourth has been referred to federal prosecutors for review.
  These four providers are considered the “exception” for which we
  need the ability to suspend a provider and stop fraudulent
  program dollars from going out the door.

In looking at these figures, I believe they clearly show the Department is

committed to pursuing fraud and abuse in the program, however, they
show we do not use the “heavy hand” approach I have heard rumors
about. We deal with those providers who are “exceptions” appropriately,
in order to protect our program resources and vulnerable clients.

To further discuss the way my staff approach such actions against
providers, my office was cited by the legislative auditor’s office in a final
audit finding, as being “slow to react to fraud and abuse” for not
suspending payments to a provider they determined was submitting
fraudulent claims. My office would not agree to issue such a suspension
until we had gathered all of the facts, and were absolutely sure it was
necessary to protect the program dollars or clients. Giving the provider
the benefit of the doubt. In the end, a suspension of payments was not
warranted and allegations against the provider were unfounded.

My office continually undergoes review and scrutiny regarding practices
and effectiveness.

• Annual legislative audits review cases, resolutions, staffing
  qualifications, and our investigative approach.





• November 2000, the Office of Performance Evaluations (OPE)
  Review noted our efforts comparable or exceeding other states
  and, therefore, recommended we not establish a Medicaid Fraud
  Control Unit. This is raised because last week I heard concerns
  about the need for a certified unit in the Attorney General’s Office.
  The OPE recommended against this approach, and
  recommended the fraud unit be transferred out of Medicaid and
  into the Division of Management Services. This division is the
  finance and accountability arm of the Department.





• There was a 2002 review by the Center for Medicare & Medicaid
  Services (CMS). The Medicaid Alliance for Program Safeguards
  team reviewed our compliance with federal regulations to include
  our ability to suspend payments to fraudulent providers. We were
  commended on our efforts.





• In August 1999, the Healthcare Financing Administration (HCFA)
  Program Integrity review commended my staff on their efforts
  preventing and detecting fraud and abuse in the Medicaid
  program.





• And finally, the most apparent scrutiny of all, the providers in this
  state. If due process was not upheld or providers were
  approached with a heavy hand, you and I would both have heard
  this quite clearly from providers with specific examples, not
  general comments. Comment was made by one member of the
  Senate Committee last week that he was surprised to hear of
  such concerns. I must say that not allowing due process, or
  unnecessary actions by my staff would not be tolerated by the
  provider community, nor myself. If raised, I would appreciate the
  opportunity to respond to specific concerns or examples.

As Senator Bailey pointed out last week, enforcement agencies are
often looked upon negatively. I agree with him whole heartedly. Having

investigated 659 providers in the last three (3) years, I would anticipate
my staff would not be popular with a few providers, but these would be
the exceptions and not the typical providers investigated.

I am also the Bureau Chief over the Internal Audit section in the
Department, responsible for reviewing internal controls and ensuring the
department is accountable. This task along with fraud investigations are
not popular functions, however, I can assure you that with this charge,
we will do our best to protect our program resources and dollars.

The Department has received numerous letters from significant providers
in our program, commending my staff on the professional approach used
during the investigations, even when they were required to refund a large
amount of dollars overpaid. I have attached some of those letters for
your review. To quote one physician who repaid an excess of $10,000,
and said he was pleasantly surprised and pleased with the Medicaid
auditors and went on to say “You are to be commended on such
personable staff in a department that is often derided by others as being
distant or secretive to its contracted providers.” These are examples of
how the majority of our provider contacts are resolved.

Chairman and members of the Committee, I am proposing to you that
these rule amendments provide us with the necessary tools to protect
our valuable and limited program resources. They help bring us one step
closer to addressing the unfortunate “exceptions” we encounter within
our program, which can quickly drain our program resources. I am asking
you for your confidence and support in these efforts and to adopt these
rules as final rules to further help the Department protect our program
funds and clients from fraud, with the exceptions of rejecting Section 210
which address the concerns of the provider association.

Thank you and I will stand for questions.

Greg Dickerson, a representative for the Mental Health Provider
Association, testified to support and adopt these rules, with the exception
of restoring Section 210, and the commitment made to revisit Section
204, and draft the due process the Department currently uses and
replace it. He appreciated the efforts of the Department to work with
providers.

Douglas K. Merkley, a private attorney from Pocatello, testified about
his objections to Docket 16-0309-0308. He expressed grave concerns
about the process of the Department’s fraud investigations, especially
the section of suspending payments to a provider. This can cause a
business to shut down. Prior to due process of appeals. Mr. Merkley
reported he represents several clients in his area who has had problems
dealing with staff from the Department’s fraud unit.

Committee members discussed the proposed pending rules governing
fraud investigations and the suspension of payments during an
investigation. The Department’s actual proposed changes to Sections
204, 208, 209, and 210, Docket 16-0309-0308, are shown below:

Section 204: SURVEILLANCE AND UTILIZATION REVIEW (S/UR)
COMMITTEE (Reserved). Instances of suspected fraud, abuse, or other
misconduct may be referred to a review committee organized by the
Department. The committee shall consist of health professionals and
other staff appointed by the Director or his designee. The committee may
also consult with other professionals as determined necessary by the
committee. The function of the committee will be to review and make
recommendations concerning corrective action.

Section 208: SUSPENSION OF PAYMENTS PENDING
INVESTIGATION. “In the event that The Department identifies may
suspend payments in whole or part in a suspected case of fraud or
abuse and the Department has reason to believe that payments made
during the investigation may be difficult or impractical to recover, the
Department may suspend or withhold payments on any pending or
subsequently submitted claims while the provider continues to participate
in the program pending investigation and conclusion of legal proceedings
related to the provider’s alleged fraud or abuse.”

Section 209: INTERIM PROVIDER AGREEMENT SUSPENSION. In the
event that the Department identifies a suspected case of fraud or abuse,
and it determines that it may summarily suspend the provider agreement
when such action is necessary to prevent or avoid immediate danger to
the public health or safety, the Department may summarily suspend a
provider or employee of a provider. This provider agreement suspension
temporarily bars the provider from participation in the Medicaid Program
pending investigation and Department action. Such a finding will be
incorporated in the order. The Department will notify the provider shall be
given notice but the order of the suspension. The suspension is effective
when issued immediately upon written, electronic, or oral notification.

Section 210: APPEAL OF IMMEDIATE ACTION (Reserved). When
payments have been suspended or withheld or the provider’s agreement
is suspended pending investigation, the Department shall provide for a
hearing within thirty (3) days of receipt of any timely filed notice of
appeal.

Written comments received by the Department of Health and Welfare
regarding fraud investigators were submitted into the record:

Bret Hamilton, administrator, Teton Family Services, Inc., in Pocatello,
regarding the Fraud Unit. (See Attachment #2)

Carl E. Wood, Jr., Evergreen Pharmaceutical, Inc., in Kirkland,
Washington. (See Attachment #3)

Stephen DeNagy, M.D., Family Care Center in Idaho Falls. (See
Attachment #4)

Jeff Hough, lobbying director for the Cooperative Action, LLC, submitted
written comments from Bill Southerland, president of the Idaho Assisted
Living Association (IDALA). (See Attachment #5)

Mike Ponkow, administrative director of the Cooperative Action LLC in
Chubbuck, Idaho also submitted written comments requesting the
committee to reject this rule and ask the Department of Health and
Welfare to formulate a new better defined rule that the providers can
comply with. (See Attachment #6)

A Letter of Opinion from William A. von Tagen, Division Chief,
Intergovernmental and Fiscal Law, Idaho Attorney General’s Office, was
introduced. The letter addressed the question “whether the placement of
the Department’s Bureau of Audits and Investigations within the Division
of Management Services sufficiently insulates the Bureau from the
influence of the Division of Medicaid.” Based on the following analysis, I
believe it does. (See Attachment #7)

Mr. Warren read Section 212 – Civil Monetary Penalties – “Pursuant to
Under Section 56-209h, Idaho Code, the Department may assess civil
monetary penalties against a provider, any officer, director, owner,
and/or managing employee for conduct identified in Subsection 211.01
through 211.09 of these rules. The amount of penalties shall may be up
to one thousand dollars ($1,000) for each item or service improperly
claimed, except that in the case of multiple penalties the Department
may reduce the penalties to not less than twenty-five (25%) if the amount
of each item or service improperly claimed if an amount can be readily
determined. Each line item of a claim, or cost on a cost report is
considered a separate claim. These penalties are intended to be
remedial, at a minimum recovering costs of investigation and
administrative review, and placing the costs associated with non-compliance on the offending provider.”

Discussion: Senator Burkett – thinks this rule making is completely
confused. It gets back to the distinction between fraud, on the one hand,
and then the rule also refers to misconduct, abuse – both financial abuse
and potential client or patient abuse. He thinks we need something
different for fraud. People suspected of fraud, it might be appropriate to
suspend payments for 30-days, wait for a hearing, then after a hearing
finding probably cause you move onto the next step.

Senator Compton asked Senator Burkett if he was rejecting the docket
entirely? Senator Burkett responded, “yes,” the changes. The motion
was seconded by Senator Bailey.

DIscussion: Senator Burkett explained that Mond has told us it is
working pretty well right now, and that he can operate under this rule.
Senator Burkett believes the Department should come back next year
with a rule that is drafted correctly. He also believes the Department
should have two sets of rules. One set of rules for misconduct, abuse
and bad practices, and a different set of rules governing Medicaid fraud.

Committee members express their difference of opinions relating to the
proposed changes and the effects on the Department’s fraud unit.

After a lengthy discussion, review, and consideration of the above listed
pending sections in Docket 16-0309-0308 (Sections 204, 208, 209 and
210), Senator Bailey withdrew his second to this substitute motion.

The motion died for lack of a second.

Discussion: Senator Kennedy explained the motion is to reject the
changes being made to rules 210 and 204, and to approve the other
amendments being made by Docket 0308 (16-0309-0308).

The motion died for lack of a second.

The substitute motion was seconded by Senator Kennedy.

Discussion – The committee members held a general discussion relating
to providers, suspended payments and suspension of contracts,
immediate danger and safety of a client, and why do the rules need to be
changed. If Section 209 is returned to the rules, how it was before these
proposed changes were made, the Department could still suspend a
provider’s agreement. The changes proposed by the Department were
intended to clarify the rules, to make it clearer on the grounds which they
would suspend a license.

Senator Burkett restated his substitute motion – the motion was to reject
Sections 209, 210, and 204, and approve the remainder of the changes
to the temporary rules 0309-0308 (Docket 16-0309-0308).

Call for Vote: The substitute motion failed.

This motion was seconded by Senator Darrington.

A roll call vote was taken on the original motion:

Senator Kennedy voted Nay Senator Stegner was absent

Senator Burkett voted Nay Senator Ingram was absent

Senator Bailey voted Nay Senator Darrington voted Aye

Senator Sweet voted Nay Senator Compton voted Aye

Senator Brandt voted Aye

The original motion – 3 Ayes, 4 Nays, 2 absent and excused

The motion was seconded by Senator Brandt.

A roll call vote was taken:

Senator Kennedy voted Aye Senator Ingram was absent

Senator Burkett voted Nay Senator Darrington voted Nay

Senator Bailey voted Nay Senator Compton voted Aye

Senator Sweet voted Aye Senator Brandt voted Aye

Senator Stegner was absent

This substitute motion carried, 4 Ayes, 3 Nays, 2 absent and
excused.

EXCUSED:

Kelly Pierce, Chairman, Commission for the Blind and Visually
Impaired presented three appointees to the Committee. The Commission
consists of five members. David Hand is a re appointee. Jim Solom, and
Bruce Zimmerman are new appointees.

David Hand, of Boise, Idaho is up for reappointment to the
Commission for the Blind and Visually Impaired to serve at term
commencing July 1, 2003 and expiring July, 1, 2006. Mr. Hand has
been with the Commission since 1998, when he filled an unexpired term.
This will be his second three-year term. He has 27 years experience in
the Idaho Lodging and Restaurant industry. Since 1964 he has worked on
the “talking book,” reading on a recorded device. He stated he wants to
repay the Commission for the benefits he has received from the
programs.

Senator Ingram asked Mr. Hand about funding of a program entitled
“News Line Program.” A program that records newspapers being read so
the visually impaired can stay updated on the latest news. The program
needs $26,000. Mr. Hand informed the Committee members that The
National Federation of the Blind was introducing some legislation this
session in regards to this issue, and that any involvement by the
Commission in this regard would be improper. Mr. Hand stated he was
working to disseminate information to the right people.

James Solom, of Lewiston, Idaho, is up for appointment to the
Commission for the Blind and Visually Impaired to serve a term
commencing on July 1, 2003 and expiring July 1, 2006. Mr. Solom has
22 years of Executive experience in Communications, having worked for
and with several large communication companies. He also has 12 years
teaching experience at the University level. He came from southern
California to Idaho to work on building an IdaNet, which runs from
Moscow, Idaho to the Canadian border. He also worked on running a
DS3, high speed network, from Couer dAlene to Boise. It was while
working on this project that Mr. Solom lost his site. He attended a school
in Boise for four months to learn Braille, and to use Voice activated
computers. He is now pursuing a doctorate degree in Education from the
University of Idaho, and anticipates graduating in 2005. He stated the
Commission for the Blind and Visually Impaired has provided him with
invaluable resources and his wish is to provide assistance, and mentor to
others with visual impairments.

Senator Stegner asked about options for tutoring for the blind at the
University of Idaho campus, as well as the lack of a Braille printer for blind
student use.

Bruce Zimmerman, of Hidden Springs, Idaho is up for appointment
to the Commission for the Blind and Visually Impaired to serve a
term commencing on July 1, 2003 and expiring July 1, 2006. Mr.
Zimmerman has held many corporate positions, has taught at the
university level, and is currently a consultant and professor at the
University of Phoenix, Boise center. Mr. Zimmerman was accompanied by
his three-year-old German Shepard guide dog. He anticipates assisting
those who have lost their sight due to age, illness or physical trauma in
the area of accessibility. He would like to improve the travel options for
the visually impaired, as well as, make technology available for those who
could benefit.

The Committee members were impressed with the character and
experience of each Commission appointee.

There was no discussion on the rule.

There was discussion on the rule relating to the Allowable Cost Manual.
The Committee would like to see the date and edition of the manual
stated within the rule. The reasoning being the Commission could change
the manual without approval of the Legislature. Mr. Stevenson,
Department of Administrative Services, stated the Commission has
statutory authority to change the rule as they see fit. He recommended
the Commission issue a temporary rule with the change, to incorporate
the date and edition of the Allowable Cost Manual, for the legislature to
approve.

Due to public comment, changes were made to proposed text as follows:
include definition for supportive counseling; revisions were made in
practice of social work; the word endorsement was added to 350; and
competent practice for social workers is defined.

Mr. Hales described the three levels of a social worker: Baccalaureate
social worker, Master social worker, and Clinical social worker. In section
010 (03) Definitions, page 256, psychotherapy can only be practiced by
Clinical social workers, or Master social workers under the supervision of
a Clinical social worker. Another distinction was made regarding
independent practice of social work and private practice of social work
and the Clinical Practice Exemption, Section 201(04) Practice of Social
Work, (04) page 257. The exemption allows a longer period of time to
meet the requirements, and expands the number of supervised hours to
receive training.

Senator Ingram asked Mr. Dickerson if he felt anyone had been excluded
or alienated by the rule. Mr. Dickerson stated with the agency exemption
clause, Master social workers can claim supervision by other Clinical
professionals. This allows flexibility. He stated it was critical to revise the
rule to clarify the definitions of social workers.

Chairman Brandt stated there was written testimony submitted to the
Committee members from Larina Warnock, and Bob Willhite.

Senator Stegner brought to the attention of the Committee and Ms.
Jacobsen, the lack of a date and edition inclusion into this rule, as well, as
on page 272, in regards to documents/manual references.

EXCUSED:

Dr. MacMillan has performed extensive research on fish health and
aquaculture issues and has published many scientific articles and papers.
He has served on many task forces, committees and associations
studying water quality, fish health and aquaculture issues.

Dr. MacMillan was originally appointed to the Board of Environmental
Quality on July 1, 2000. He lives in Twin Falls, Idaho. Dr. Macmillian has
been reappointed by Governor Dirk Kempthorn for a term to expire on
July 1, 2007, and his political affiliation is with the Republican party.

Senator Darrington asked Dr. MacMillan about his work with toxic
elements and fish. Senator Darrington reported his committee will soon
be hearing proposed legislation relating to aquaculture terrorism and
increasing the criminal penalties for those terrorist acts.

Mr. Purdy is a past director of the Idaho Cattleman’s Association, served
on the Board of Directors of the Idaho Nature Conservancy, and was
awarded the National Environmental Stewardship Award, the Department
of Interior Stewardship Award, and is in the Southern Idaho Livestock Hall
of Fame.

He was originally appointed to the Board of Environmental Quality by
Governor Dirk Kempthorn on July 1, 2000, and reappointed for a second
term beginning July 1, 2003. His area of interest and expertise is water.
He has been reappointed by Governor Dirk Kempthorn for a term to
expire on July 1, 2007, and his political affiliation is with the Republican
party.

Mr. VonLindern is a graduate from the University of Idaho in Civil
Engineering, and is a licensed engineer. He has been Public Works
Director for the City of Lewiston and Grangeville, Idaho. Formerly he
worked for the Idaho Division of Environmental Quality as a water quality
engineer and then Regional Administrator of Region II.

Currently he is the Environmental and Manufacturing Manager for Alliant
Techsystems, a manufacturing operation in Lewiston. His primary
responsibilities include managing the department to exceed
environmental compliance requirements and setting future environmental
direction for the location.

Mr. VonLinder is active in a number of environmental organizations and
serves as Chairman of the Nez Perce Local Emergency Planning
Commission, Vice Chairman of the Clearwater Basin Advisor Group, and
has previously served on the Hazardous Waste Facility Siting Panel. His
political affiliation is Republican.

Background:

• Two (2) separate loan funds -Water Pollution Control
  (Wastewater) Loan Fund & Drinking Water Loan Fund.





• Wastewater Loan Fund established in 1987 Amendments to
  Clean Water Act & Idaho Code, Title 39, Chapter 36,
  authorized federal funding through federal fiscal year 1994.





• Drinking Water Loan Fund established in 1996 Amendments
  to the Safe Drinking Water Act and Idaho Code, Title 39,
  Chapter 36, authorized federal funding through federal fiscal
  year 2003.





• Purpose of both funds is to provide perpetually a revolving
  source of low interest loan funds for design and construction
  of wastewater and drinking water projects (loan repayments
  go back into the fund to be re-lent to others).





• Each Fund receives:
• Annual Congressional Appropriation (approximately $6.5 and
  $8 million)
• Annual 20% State Match appropriated from Water Pollution
  Control Account ($1.3 and $1.6 million)
• Loan Repayments (Principal & Interest)
• Interest on Repayments (Cash in the Fund-invested by State
  Treasurer)





• Federal Funds are in form of a “Capitalization Grant” that
  comes from EPA.





• Capitalization Grants require:
• Annual Priority List of Projects Approved by DEQ Board
• Schedule by which federal funds are awarded





• Loan Terms – repaid within 20 years of project completion;
  interest rate must be below market (3.5% for FY04).

SRF Requirements:

Some Major Project Requirements

• Engineering report prepared by Licensed Professional
  Engineer
• Environmental information Document (EID)
• DEQ issues a finding – (Categorical Exclusion, Finding of No
  Significant Impact Environmental Impact Statement)
• Must be bid like any public work’s project
• Loan closed at the end of construction (Revenue Bond, LID
  Bond or Promissory Note issued)

Loan Status:

Total Amount Loaned:

• Wastewater SRF – $176 million. Drinking Water SRF – $40
  million (See Attachment #1)

Total Amount Capitalized Through State FY04:

• Wastewater SRF – federal ($102 million); state match ($20
  million); Repayments *$71 million); interest on Fund ($10
  million.
• Drinking Water SRF – federal ($45 million); state match ($12
  million); repayments ($1 million); interest on Fund ($16
  thousand).

Status of Federal Grants – received Federal FY03 funds; Federal
FY04 funds not released; Federal FY05 in President Bush’s budget
35 percent (35%) cut for wastewater SRF.

Projected Need for Loan Funds:

• Wastewater – 2000 Needs Survey $181 million; FY03 – $41
  million; estimated FY04 – $12 million.

Current legislative forecast for Water Pollution Control Account.
(See Attachment #2)

Path Forward:

Alternative means of Capitalization for loan funds.

• Leverage funds through Treasurer’s Bond Bank
• Sell part or all of portfolio – bond bank or private sector.
• Request establishment of a group to investigate and
  consider alternative sources of capital.

Director Allred requested the committee to consider an interim
legislative committee to meet with DEQ and others to study the
Loan program. Senator Brandt agreed to send a letter to pertinent
committees for their interest in forming an interim committee.

Currently, the programs are funded by 4 percent (4%) of the annual
federal contributions (approximately $13.8 million per year). This level of
federal contribution is expected to decrease and will not provide sufficient
resources for DEQ to manage the programs as the total funds managed
have increased to more than $150 million. This funding mechanism will
allow the programs to be self supporting.

There is no fiscal impact to the general fund. A reduction in the SRF funds
available for future loans would be in the amount of the funds used to
administer the program. DEQ envisions no increase cost to borrows. The
current “at or below” market interest rate will continue.

It sets forth the policy, title, required license and definitions. Additionally, it
provides for a board, to be appointed by the Governor, with qualifications,
number, terms of office, removal from office, procedures, powers and
duties. It states finances, fees, providing for the issuance of licenses with
an annual renewal. It provides for the revocation or suspension of
licenses, violations and penalties. It establishes that an emergency exists
and that this act shall be in full force and effect on and after its passage
and approval. The IBOL will provide administrative, legal and financial
services to the board.

There will be no fiscal impact to the General or Dedicated funds. This will
be a self-supporting program funded by operator licensing fees.

EXCUSED:

Appointee Floor Sponsor__

Bruce Zimmerman, Hidden Springs Senator Kennedy

James Solem, Lewiston Senator Stegner

David Hand, Boise Senator Burkett

22-0103-0301

A) Docket 22-0103-0301 is a pending fee rule of the Idaho State Board
of Medicine. The rule is adopted as a pending rule by the Board of
Medicine and is presented for review by the 2004 Legislature.

b) Rules submitted for consideration by the 2003 Legislature and

due to some last minute concerns the rules were requested to be
disapproved by both the House and Senate Health and Welfare
Committees to allow the Board to make further revisions.

c) The rules were published in the Administrative Bulletin for the State of
Idaho on October 1, 2003, as proposed fee rules and notification was
provided to every licensee of the Board in the Board of Medicine
newsletter in the summer of 2003.

d) Public hearing – held in November 2003 and changes were made the
proposed rule as result of the public input.

II. OVERVIEW:

a) The rule revises and updates the scope of practice definitions and
provides clear requirements for the delegation of patient services by the
supervising physician, and provides method for requesting the approval of
special procedures.

b) The rule provides for patient safety by limiting the numbers of
physician extenders that a physician may safely supervise and provides
for required review of education, training, and experience of each
physician assistant assigned.

c) Provides that a copy of the delegation of services agreement be filed
with the Board.

d) The rules also define committee membership requirements and
clarifies the responsibilities per the 1993 resolution of the Board of
Medicine.

e) No fees are increased nor is an increase anticipated, in fact the Board
anticipates being able to reduce fees with on-line renewal.

f) Provides housekeeping and grammar changes.

III. SUMMARY OF CHANGES – PROPOSED:

Sections:

000 – Grammar changes and corrects omission of graduate PA

010.02 – Names of accrediting agencies listed

010.04 – Addition of education and training listing to each Delegation of
service agreement.

011 – Adds the requirements for the committee membership and
responsibilities.

021 &022 – Clarifies the application process and limits the application
pending period.

028b – Scope of practice language changed to reflect agreed language.

Concerns expressed were ” and other anesthesia services associated
with the operating room.” The interpretation was that PA’s would be
allowed to perform all forms anesthesia delivery.

028d – Supervising physician definition reiterated in scope of practice.

033 – Delegation of services agreement changed to include education
and training of physician assistant, and clarification of process to approve
specialized procedures and periodic review of the plan and services.

037 1-2 I Removes trainees from the discipline and adds failure to report

violations of the rules as grounds for discipline.

053 – Adds delegation of services agreement requirement for graduate

physician assistants.

Rules are listed as fee rule. No additional or increased fees are charged
or anticipated. Language is changed to reflect range of fees.

PENDING RULES:

000 – Grammar changes.

010 – Corrects the accrediting agency name and requires review of
Delegation of Services (DOS) agreement by the Board.

028 – Clarifies scope of practice and changes wording to agreed
language. Clarifies the limitation of supervision to three (3) PA’s with a
waiver allowing up to six to be supervised.

030 – Adds listing of PA education and training on all DOS agreements,
and provides requirements for special procedure approval.

036 – Grammar changes and clarification of graduate application.

037 – Removes redundant language, adds graduate PA”S to discipline

requirements.

22-0104-0301

a) Docket 22-0104-0301 is a pending fee rule of the Idaho State Board
of Medicine. The rule is adopted as a pending rule by the Board of
Medicine and is presented for review by the 2004 Legislature.

b) The rules were published in the Administrative Bulletin for the State of
Idaho in October 1, 2003, as proposed fee rules and notification provided
to every licensee of the Board in the Board of Medicine newsletter in the
summer of 2003.

c) Negotiated rule process for the AT and PA highlight needed changes
to these rules.

II. OVERVIEW:

a) The purpose of the rules is to update the rules for supervising
physicians as required by changes to the PA rules and to add the
requirements for directing physicians as required by the changes to
athletic trainer’s act and rules.

b) The rule provides for patient safety by limiting the numbers of
physician extenders that a physician may safely supervise and provides
for required review of education, training, and experience of each
physician assistant assigned.

c) Defines fee range for the registration of directing physicians.

d) Clarifies the responsibility of supervising and directing physicians,
directs complaints to the appropriate licensing board and limits scope of
practice to that of the supervising physician or directing physician.

III. SUMMARY OF CHANGES:

a. Proposed Rules: Section:

000-007 – Changed to reflect current statutory guidelines for rule format.

010 – Definitions added to reflect addition of directing and alternate directing physician, clarifying existing definitions and adding correct
statutory and rule references.

020-022 – Clarifies responsibilities of supervising and directing physicians
related to professional group supervised, directs complaints to the
appropriate licensing board.

030-40 – Defines registration requirements and sets fees for directing
physician category.

SECTION – PENDING RULE:

010 – Corrects typographical error and removes limitation on numbers of professionals licensed.

019 – Clarifies definition of available supervision.

020 – Removes requirement for recording of review, clarifies limitation on
number of licensees supervised.

040 – Clarifies fees as they apply to all supervising physicians.

Adds fee for directing physicians and clarifies fees as they apply to all
supervising physicians(including interns and externs).

22-0110-0301

a) Docket 22-0110-0301is pending fee rule of the Idaho State Board of
Medicine.

b) The pending rules before the house are the result of negotiated rule-making process with chiropractic physicians association, athletic trainers
association, and physical therapist association representatives. Licensees
of the board were notified of the rulemaking process in the summer 2003
newsletter.

c) The rules were published in administrative bulletin 03­10 and a public
hearing was held in October 2003.

II. OVERVIEW:

a) The purpose of the rules is to update the rules for athletic trainers to
reflect changes of House Bill 199.

b) The rule provides for a more formal defined relationship with the
directing physician to be defined as the Athletics service plan or protocol.

c) Defines the duties and responsibilities of the directing physician,
clarifies the licensing types, allows for two-year renewal, and clarifies the
renewal process including continuing education requirements.

d) Clarifies appointment and responsibilities of the Board of athletic
trainers, and designates that a contact person for the Board of
Chiropractic Physician’s be assigned.

e) Clarifies the complaint process has it relates to the directing physician
and the athletic trainer.

f) Requires the scope of practice to be consistent with the practice of the
directing physician.

g) No fees were increased nor is there increase anticipated.

III. SUMMARY OF CHANGES:

a. Proposed Rules: SECTION:

001-007 – Format and wording changes as per state requirements.

010 – Definitions clarified, addition of service plan and Chiropractic
Physicians Boards.

011 – Rules added for removal of board member for cause and removal of
references to registration.

012 – Scope of practice defined and limited to scope of directing
physician.

013 – Defines the requirements for service plan. Written agreement/plan

between AT and physician on what services will be provided, addressing
situations outside of scope of practice, and reviews.

014 – Defines responsibility of directing physicians.

015 – Registration requirements for directing physicians.

016 -030 – Clarifies requirements for licensure and application
requirements.

040 – Clarifies the license renewal and expiration requirements and
clarifies license types. Defines the requirement for continuing education.

050-051 – Defines inactive license status and the application of inactive
fees to full licensure status. Changes fees to range of fees.

052 – Defines grounds to refuse licensure or take other licensure action.

061 – Changes fee to range. No additional or increases in fees are listed
or anticipated.

b. PENDING RULES: SECTION:

012 – Addresses the issue concerning recreational athlete with agreed
language.

013 – Clarifies the form and format for service plan.

014 – Defines methods of availability of direction, identification
requirements and complaint procedures.

015 – Clarifies directing physician registration requirements and provides
fee range for new category of “directing physician.”

030 – Defines application process and removes reference to registration.

040 – Clarifies the license issue, renewal and expiration terms.

052 – Adds the practicing beyond the scope of the directing physician to
grounds for licensure action.

Appendix A – Removes patient and returns wording to athlete.

22-0111-0301

a) Docket 22-0111-0301 pending fee rule of the Idaho State Board of
Medicine. The purpose of the rules is to comply he statutory requirements
of the new respiratory therapy act passed by the 2003 Legislature.

b) The pending rules are the result of negotiated rule-making process
with the polysomnographer’s association and respiratory therapist
association representatives. Licensees of the board were notified of the
rulemaking process in the summer 2003 newsletter.

c) The rules were published in administrative bulletin 03­10.

II. OVERVIEW:

a) The purpose of the rules is to update the rules for respiratory
therapists to reflect changes of Senate Bill 1165.

b) The rule provides addition of Polysomnographer permit types and
related terminology definitions.

c) Defines permit requirements and grounds for discipline for permitted
polysomnographers.

d) Clarifies appointment and responsibilities of the Board of respiratory
therapists and provides dual licensure permit requirements for
polysomnography representative.

e) Provides for two-year licensure renewal process.

f) Provides an uniform grounds for refusal to issue or renew a license or
permit and suspension and revocation of license or permit.

III. SUMMARY OF CHANGES:

a) Proposed Rules: SECTION:

00-07 – Grammar and format changes, addition of polysomnography to
rule authority.

010 – Addition of polysomnography terms to definitions..

011 – Clarifying the RT Board membership, responsibilities, terms and

grounds for removal of board members.

031 – Adds the permit requirements for PSG and corrects terms used,

clarifies inactive RT licensure, defines application and continuing

education requirements for permitees.

033 – Defines exemptions as related to RT licensure.

034 – Clarifies language and removes annual licensure requirement.

035 – Includes PSG in definitions of grounds for licensure action, clarifies

and provides standard terms for grounds for license action.

046 – Provides range for fees charged, clarifies application of inactive

license fees to reinstatement cost.

046.02 – Provides fee range consistent with RT fees for PSG.

046.03 – Clarifies dual license status with no additional license fee

required.

b. PENDING RULES: SECTION:

011 – Correct grammar and typographical errors.

032 – Clarifies requirement for all applications.

035.05 – Corrects terminology, clarifies supervision requirements.

035 – Clarifies action as related to PSG respiratory care.

EXCUSED: